Youth unemployment and associated factors in India

Abstract

Despite different policies targeting youth unemployment, it remains a significant concern in the Indian labour market. Due to high levels of youth unemployment, the country is not able to reap the desired benefits of the demographic dividend. Therefore, in this article an attempt is made to examine the individual and socio-economic factors associated with youth unemployment and the prevalence of informal employment among Indian youth. By utilising the definitions of the informal sector and informal employment provided by the National Council for Enterprises in the Unorganised Sector (NCEUS) and the conceptual framework from the 17th International Conference on Labour Statistics (17th ICLS), the paper conceptualises the issue of informalisation and how far youth are employed in this sector in the Indian labour market. Further, to identify the determinants of youth unemployment, a binary logistic regression model is used. The study reveals that several variables, including education, gender, residence, caste, age, marital status, vocational training and economic status of families are significant factors that influencing the youth unemployment in India. The study finds that a substantial proportion of Indian youth remains unemployed or employed in informal sector. This highlights the potential gap between demand for and supply of skills. Therefore, the article argues that there is a pressing need to bridge any information gap between education and industrial demands of skill. For that, employers and educators’ need be part of policy formation that targets youth employment.