The year 2011 marks a landmark year for change in demographic pattern in India. Two noteworthy things have happened in India in the last few decades. Firstly, annual addition to population, in absolute numbers, has remained more or less constant for the last 20 odd years. Secondly, the number of students going in for graduation studies (15 years of formal education for non-engineering streams and 16 years of formal education for engineering streams) has increased rapidly and is expected to continue to increase rapidly for the foreseeable future.
An interplay of these two factors means that 2011 marks the first year in the history of Independent India where addition to labor force, excluding graduates, will be lower as compared to the previous year.
Rapid economic growth envisioned for India, coupled with relative decline in entry of „non-graduate. labor has interesting ramifications for India. Already, we are seeing anecdotal evidence in scattered reports of shortage of farm hands and of long distance lorry drivers. We expect rapid mechanization of farm activities in India over the next two decades. Also, relatively low skilled jobs such as parking attendants will be automated in Urban India, as employers respond to this change in trend.
A persistence of this trend will be good news for productivity improvements in India.