Job Polarisation in India: Structural Causes and Policy Implications

31 Pages Posted: 2 Apr 2019

See all articles by Francis Kuriakose

Francis Kuriakose

Erasmus University Rotterdam

Deepa Iyer

University of Cambridge, Students

Date Written: December 28, 2018

Abstract

Automation impacts employment and wage levels at the micro-level, and the structure of employment-shift at the macro-level. Job polarisation is defined as the automation of ‘middle-skill’ jobs that require routine cognitive and manual applications while high and low-skill occupations are preserved. This paper examines the nature of job polarisation in India during the period 1983-2012 when Indian manufacturing was being gradually automated. The research uses disaggregated data from National Sample Survey Office and examines supply-side factors such as nature of employment growth in manufacture and presence of educated labour force which have not been adequately analysed before. The study has three observations. First, only the increased demand for high-skilled workers in the formal sector is due to skill-bias of technology conforming to theoretical expectation. Second, the transition of agricultural labourers has been to low-skill manufacturing sectors such as construction and textiles signalling distress in traditional manufacturing to provide employment. Third, over-supply of secondary and tertiary educated labour force has squeezed out middle-skilled workers from middle-skill jobs to relatively low-skill manufacturing and service occupations, explaining the persistence of routine occupations. The study concludes that increased demand for high and low-skill jobs has co-existed with the persistence of middle-skill jobs in India.

Keywords: Automation, Job Polarisation, Supply-Side Factors, Manufacturing, India

Suggested Citation

Kuriakose, Francis and Iyer, Deepa, Job Polarisation in India: Structural Causes and Policy Implications (December 28, 2018). Available at SSRN: https://ssrn.com/abstract=3347748 or http://dx.doi.org/10.2139/ssrn.3347748

Francis Kuriakose (Contact Author)

Erasmus University Rotterdam ( email )

Burgemeester Oudlaan 50
Rotterdam, 3062
Netherlands

Deepa Iyer

University of Cambridge, Students ( email )

Cambridge
United Kingdom

HOME PAGE: http://www.cam.ac.uk

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