Finance Minister Nirmala Sitharaman has stressed that the 2021 Budget will help India emerge as the engine for global growth. For this, job creation will be crucial, as the economy struggles to revive itself post the COVID-19 pandemic.
One litmus test for this budget will be whether it can benefit the sectors that will boost job creation and help India achieve its dream of becoming a $5 trillion economy.
India's economic recovery will be defined by its expenditure and investment in youth—who will need re-skilling, up-skilling and new-skilling to compete in the new normal. The sectors expected to get the limelight in the budget are healthcare, infrastructure, manufacturing, defence and capital markets.
“Boosting investments in the infrastructure sector will continue to remain a big focus of the budget because of the job creation potential of the sector. Tweaks in the PLI scheme to boost investments in manufacturing and changes in import tariffs. The budget is an opportunity to bring in reforms in agriculture, helping farmers and the ecosystem such as food processing, packaging, cold chains and on the other hand, agri-inputs to focus on higher productivity. Focus on divestment will be another highlight given the weak progress on that front so far. This would help the government spend on education, skill development and healthcare. PPP initiatives in nation-building are expected to find a greater focus than ever before,” observes Aditya Narayan Mishra, the Director and CEO, CIEL HR Services.
It is further expected that out of many sectors the IT and IT infrastructure sector will continue to grow gradually and will pave the way for more jobs. Besides this, some of the other sectors expected to show rapid growth are manufacturing, pharma, healthcare, education and energy sectors. It is expected that the budget will pave the way for boosting significant investment in the digital education space and is likely to continue and create more employment opportunities as well.
The manufacturing sector ended 2020 at a good pace and was one primary factor driving economic recovery post the lockdown. Net investment in the sector was around $614.85 billion in 2020, and this is expected to rise during 2021.
“Traditional job roles in the sector might change with the increased adoption of automation (Artificial intelligence, machine learning, robotic process automation). Across all sectors, AI is expected to create 2.3 million new job roles in 2020 alone, and investment in upskilling individuals in these roles will become necessary,” pointed out Neeti Sharma, Senior Vice President, TeamLease Services.
The Ed-Tech sector also received over $2.2 billion investment in 2020 that equals a four-time rise since the previous year. The adoption of digital technology has accelerated growth in this sector and this is likely to be more than just an anomaly.
“One of the major consequences of the COVID-19 pandemic has been the adoption of technology to learn, earn, and yearn. Online learning and delivery platforms ensured continuity in learning and assessments. The pandemic has pushed Ed-Tech firms, teachers, instructors, and educators to reskill and upskill themselves in order to stay relevant. With capital investment in Ed-Tech increasing by almost five per cent in 2020, one can safely say that the industry witnessed a boom akin to the IT boom of the ’90s in India. Technological growth and adoption act as a driver and benefit the economy at large,” added Sharma.
Some experts also believe that there are two categories of high-growth sectors that will create jobs for India in its journey to become a $5 trillion economy: Those that create value jobs and those that create volume jobs.
“The top sectors that will generate value jobs are going to be digital economy technology, software products and SaaS, IT services, pharmaceuticals, high-tech Research and Development (R&D) and defence manufacturing. On the other hand, sectors that will create volume jobs are going to be mobile manufacturing, automobile manufacturing, BPO, blue and grey collared jobs in the platform economy, and the government-led domestic infrastructure,” said Anshuman Das, Co-founder and CEO, CareerNet Technologies.
Though many reforms are expected in the banking sector it is expected that the BFSI (Banking, Finance and the Insurance) segment will need a 1.6 million skilled workforce by 2022 as per estimates of NSDC.
“About 50 per cent of the BFSI jobs will need to be reskilled as technology takes over back-office operations. This will help create new roles in BFSI such as cybersecurity analyst, blockchain architects, credit analysts, wealth management experts etc,” remarked Anique Khan, Account manager, Manipal BFSI.