“Job-linked incentive schemes are a double-edged sword—offering short-term employment but risking long-term structural distortions”. Evaluate the merits and pitfalls of employment subsidies. Also suggest ways to ensure sustainable job creation.
Kartavya Desk Staff
Topic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment
Topic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment
Q5. “Job-linked incentive schemes are a double-edged sword—offering short-term employment but risking long-term structural distortions”. Evaluate the merits and pitfalls of employment subsidies. Also suggest ways to ensure sustainable job creation. (15 M)
Difficulty Level: Medium
Reference: TH
Why the question In light of the launch of the Employment Linked Incentive (ELI) Scheme, sparking debate on the efficacy and risks of subsidised employment strategies. Key Demand of the question To critically evaluate both advantages and drawbacks of employment subsidies and propose concrete, forward-looking strategies to ensure sustainable job creation in India. Structure of the Answer: Introduction Briefly state how job-linked incentives can address employment gaps but may distort labour markets if not backed by systemic reform. Body Examine key benefits of employment subsidies like formalisation, inclusivity, and demand stimulation. Analyse risks including job insecurity, fiscal burden, and weak accountability. Suggest measures like outcome-based disbursal, skilling alignment, digital monitoring, and MSME-centric strategies. Conclusion Summarise the need to integrate short-term incentives with long-term structural employment planning and regulatory reform.
Why the question In light of the launch of the Employment Linked Incentive (ELI) Scheme, sparking debate on the efficacy and risks of subsidised employment strategies.
Key Demand of the question To critically evaluate both advantages and drawbacks of employment subsidies and propose concrete, forward-looking strategies to ensure sustainable job creation in India.
Structure of the Answer:
Introduction Briefly state how job-linked incentives can address employment gaps but may distort labour markets if not backed by systemic reform.
• Examine key benefits of employment subsidies like formalisation, inclusivity, and demand stimulation.
• Analyse risks including job insecurity, fiscal burden, and weak accountability.
• Suggest measures like outcome-based disbursal, skilling alignment, digital monitoring, and MSME-centric strategies.
Conclusion Summarise the need to integrate short-term incentives with long-term structural employment planning and regulatory reform.