The Challenges of the Center’s Million-Person Hire Plan

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Last week, the central government said it would fill its current vacancies in “mission mode”. If this mission holds, one million Indians will land central government jobs in the next 18 months. hiring models.

As of March 1, 2020, the latest date for which this data is available, the central government had around 3.18 million employees against a sanctioned workforce of around 4 million. Thus, the government aims to fill about a fifth of its sanctioned workforce in 18 months.

The track record is not solid. Last year the government told parliament it had recruited 444,813 new staff in the five-year period between 2016-17 and 2020-21. At this rate, adding 1 million new employees will take about 11 years. In other words, the Center seeks to compress 11 years of employment into 18 months.

Between 2003 and 2020, the central administration workforce decreased. In March 2003, there were 3.57 million employees. In March 2012, this figure fell to 3.15 million, before climbing to 3.18 million in 2020.

On a net basis (new hires less employees leaving the service), the trend is one large hire in one year, followed by several years of small net departures.

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The two big years were 2003 and 2013, both pre-election years, as was 2023. But even that won’t solve India’s simmering jobs crisis, while stretching public finances further.

Financial implications

An addition of 1 million will have financial implications for the government. The number of employees in March 2020 was 11% lower than in March 2003. However, during this period, government payrolls and pension payments increased at a compound annual rate of 16%. This doubles approximately every four and a half years. The share of these two items in total government expenditure is expected to increase from 7.1% in 2003-04 to 12.1% in 2022-23.

The 23% increase in staff, also all at once, will increase the Centre’s payroll. This will not increase the government’s pension liabilities, as the government has moved from a “defined benefit” system for new employees (lifetime insured pension) to a “defined contribution” system (pension based on employee personal savings) from January 2004. However, government pension commitments for current and former employees who joined the service before this cut and are still alive remain quite onerous.

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Lower profiles

While 1 million new jobs is significant, it’s nowhere near enough given the current demand for jobs. According to the government’s 2020-21 periodic labor force survey, around 33 million people in the 15-59 age group wanted to work but did not have a job. Moreover, the central government accounts for only about 3.4% of workers who earn a salary or regular salary in India.

In 1957, the government’s sanctioned workforce stood at 1.73 million, according to the report of the Seventh Central Wages Commission published in 2015. It peaked in 1994, at 4.17 million. As of March 1, 2020, there were 4 million, with 20% vacancies, that the Center is looking to fill over the next 18 months. Although vacancies exist at all levels, 90% of them are for unlisted group C personnel, which essentially comprises the lowest levels of central administration and includes functional profiles such as pharmacists, technicians, constables and clerks.

Ministry focus

These vacancies are equally spread across the 77 ministries and departments that make up the Government of India. Within them, the strength of the staff is skewed. Only five ministries and departments account for about 92% of centrally sanctioned posts and employees: Railways, Home Affairs, (Civil) Defence, Posts and Revenue.

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Vacancies are quite high in some of the 16 ministries and departments with a sanctioned workforce of over 10,000. It is 66% in the science and technology department, 49% in the mines ministry and 39% in civil protection. Extensive studies have not been carried out on the efficiency and size of central government staff, but the report of the Fifth Central Wages Commission in 1997 noted that the data did not provide any guidance as to whether the “bureaucracy as a whole is ‘bloated’ or not”. For now, the government is looking to become the biggest it has ever been.

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