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India's manufacturing jobs rose by 200% from 2022-2024
Industry News- Jul 27,24
The services sector including IT and non-IT industries, still remains the largest job creator in India.
Manufacturing in India is experiencing a significant turnaround, and the government's budget boost for factory jobs could catalyse further growth.
According to an exclusive study by Teamlease Degree Apprenticeship, the pace of job growth in manufacturing has surpassed that of the services sector, which has been the largest employer since the IT boom of the early 2000s. Manufacturing jobs grew by 200% over the past two years (2022 to 2024), while the services sector saw a 35% decline.
The services sector including IT and non-IT industries, remains the largest job creator in India. However, manufacturing has gained momentum, particularly in the past two years, due to production-linked incentive (PLI) schemes and companies expanding their workforce. Meanwhile, the tech industry has faced challenges due to global economic uncertainty.
The number of direct jobs in manufacturing has shown substantial growth, rebounding from a low of -27% in 2021 (29.83 million jobs) to 5.8% in 2022 (31.57 million jobs), 12.9% in 2023 (35.65 million jobs), and a projected 18.4% in 2024 (42.2 million jobs). In contrast, the services sector's growth rates have slowed, dropping from 49.9% in 2021 (21.75 million jobs) to 35.5% in 2022 (29.48 million jobs), 27.5% in 2023 (37.6 million jobs), and an estimated 23.1% in 2024 (46.3 million jobs).
The analysis covers manufacturing sectors such as automobile, electronics, infrastructure, construction, textiles, and engineering.
"Manufacturing job creation needs to be much larger," said Anish Shah, CEO and MD, Mahindra Group.
With the government's Viksit Bharat goals, "manufacturing has to multiply in terms of job creation," said Shah. "As India becomes the manufacturing hub for the world, in line with the Make in India goal, there will be a much greater focus on manufacturing."
Teamlease data projects that manufacturing will generate 6.5 million jobs in 2024, with an estimated growth rate of 18.4%.
"Government initiatives are prompting many domestic and foreign enterprises to establish production facilities. The expanding domestic market, driven by a burgeoning middle class with increased disposable income, creates significant demand for high-quality manufactured goods," said Sumit Kumar, Chief Strategy Officer, TeamLease Degree Apprenticeship. "Additionally, employment-linked incentive (ELI) schemes, with a Rs 100 billion budget allocation, may generate another 8 million jobs in the next three years. The program aims to skill 10 million youths over the next five years."
Top executives emphasised the need for further efforts to boost manufacturing jobs.
"Besides capacity expansion, we need horizontal growth in new facilities, segments, products, and contract manufacturing. Pharma and defence are promising sectors, along with newcomers like electronics," said Harsh Goenka, Chairman, RPG Enterprises. "The government aims to revive the capex cycle by allocating Rs 11.11 trillion for infrastructure."
Manufacturing job growth is driven by infrastructure development, government initiatives like Make in India, and technological advancements.
"Key opportunities are emerging in renewable energy, electric vehicles, and strengthening supply chains," said Sharad Mahendra, Joint MD and CEO, JSW Energy. "The growth in manufacturing jobs is due to economic recovery, increased investments, and global supply chain shifts favouring India as a manufacturing hub. These trends will continue to boost job creation in the sector."
Many of these jobs will be in the construction sector, which has been thriving, combining unskilled and skilled labour.
"The electronics sector will also be a major contributor," said Madan Sabnavis, Chief Economist, Bank of Baroda. "On the services side, the IT sector has slowed down, but BFSI, travel, tourism, hospitality, and aviation are doing very well."
Ashok Ramchandran, Director- HR, Aditya Birla Group added, "With current businesses expanding and new players entering manufacturing across various sectors, both core and consumption-based, job opportunities have increased."
(Source: ET)
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