Education Minister Quits Over Leaks
Last month, Dharmendra Pradhan was compelled to step down as India’s minister of education when irate Gen-Z demonstrators went to the streets over the frequent leaks of entrance exam papers.
Prime Minister Narendra Modi has been able to resolve an immediate crisis thanks to his departure. But controlling youth unrest may prove to be a long-term struggle for his administration.
Modi appointed tech billionaire Nandan Nilekani to spearhead a government effort to reform the examination system. And swiftly announced fast-track courts to try those accused in the leaks.
A more coordinated effort may be required to allay the concerns of the youth. Who claim they are growing impatient with a system that cannot provide them with better livelihood opportunities or education that leads to productive employment?
India's Youth Unemployment Crisis
“Over the past ten years, the labor market has gotten harsh. Real earnings have stagnated and non-farm jobs have not been expanding.
According to senior economist Santosh Mehrotra, author of a recent book titled India Out of Work.
“India is dealing with a concurrent issue. Because of the economy’s structural weakness. 0ur educational system is so inadequate that it cannot produce fresh, employable workers.
Thus far, the government’s default has been fast GDP growth driven by significant infrastructure spending. Defense against accusations that India’s economic growth trajectory is unequal.
However, the turmoil of the last month could finally force them to face the educational problem.
With more than 360 million individuals between the ages of 15 and 29, India has the highest youth population in the world.
Enrollment in education has advanced significantly, and during the past 20 years, the number of private institutions and vocational training facilities has increased dramatically.
But according to Azim Premji University’s State of Working India 2026 study, “the transition from education to employment remains a major challenge, particularly for graduates“.
Young people’s unemployment rates are significantly higher than worldwide norms and over four times higher than those of non-youth.
The issue is not brand-new. For the past 25 years, graduate unemployment has been between 35 and 40 percent.
Graduate Unemployment Surges in India
In 1983, 13% of those aged 20 to 29 were unemployed, and just 4% of them had graduated. Of the 28% of graduates in 2023, 67% were unemployed.
Employability is still significantly impacted by the quality of education, and the rise in graduate employment has not kept pace with the number of graduates.
Only around 2.8 million of the roughly five million graduates who were added annually between 2004–05 and 2023 found work, and an even lower percentage entered paid employment.
This contributed to increased graduate unemployment and declining wages growth, according to the analysis.
Furthermore, there is no proof that aspirations are rewarded. According to the research. Fewer than 7% of graduates or postgraduates obtained regular paid positions. Just 3.7% secured white collar work.
India's Manufacturing Jobs Decline
Short-term solutions won’t solve this issue.
A swift recovery of the small and medium-sized enterprises (SMEs), which have been totally shut down since “demonetization” (the removal of 86% of India’s currency from circulation in four hours in a widely criticized policy move) and the uneven implementation of a goods and services tax.
He continues, “India will need to come up with a new industrial policy to concentrate on reviving overall manufacturing.”
The manufacturing sector now accounts for 14% of the GDP, down from 17% in 2015.
Additionally, employment in manufacturing declined for five years following 2015 and has just recently increased marginally above previous levels.”
AI Threatens India's Job Market
Mehrotra claims that since 2020, the number of persons employed in agriculture has really increased by 80 million, a clear indication of covert unemployment.
This is due to the fact that workers in rapidly industrializing economies generally transition from agriculture to manufacturing or services, as is the case worldwide.
All of these difficulties have been made worse by the fact that the introduction of AI has put the business models of important companies that provide jobs.
Such as software, which has been a pillar of the Indian middle class dream for thirty years, in jeopardy.
Wages have been flat for years. IT employment has increased by single digits in recent months. Insecure contract work is growing.
The knowledge-based positions that Indian STEM graduates took for granted twenty years ago are no longer available in large quantities.
India's IT Workers Demand Hikes
In fact, hundreds of workers at HCL Technologies, one of the largest software businesses in the nation. Disrupted a recent event in Chennai by screaming, “We want a hike,” in unison. Expressing the discontent of a sector that was once the key to a better living.
The decline of white-collar knowledge professions will require young graduates to rewire their minds.
That is a shorthand for expressing that young Indians, especially those with graduate degrees, would have to deal with the reality of working as mechanics, electricians, and plumbers rather than expecting to have luxurious jobs in air-conditioned offices.
This is what prominent market investor Devina Mehra noted on X.
