Scholars call a pattern in which GDP grows without generating much employment ‘jobless growth’. Which policy of 1950-1990 was meant to generate more employment for a given amount of investment?
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Promotion of small-scale industries, which are more labour intensive
Small-scale industries are labour intensive: they use more labour than large units, so they create more jobs for the same investment. This is the opposite of jobless growth, where output rises but employment does not.
Option (1) Land ceiling, which fixed the maximum land an individual could own — Incorrect. Land ceiling aimed at equity in land ownership, not at jobs from investment.
Option (2) Promotion of small-scale industries, which are more labour intensive — Correct. More labour per unit of investment means more employment.
Option (3) Licensing, which let firms expand only when the economy needed more goods — Incorrect. This kept output in line with what the economy required; it was not about jobs.
Option (4) State control of the commanding heights through the public sector — Incorrect. This gave the government control of the key industries of the economy.
This question uses Indian Economy 1950-1990 and Employment: Growth, Informalisation and Other Issues together.
NCERT (2026-27): “2.4 Industry and Trade … It is believed that small-scale industries are more ‘labour intensive’ i.e., they use more labour than the large-scale industries and, therefore, generate more employment. …” Chapter 6, Employment: Growth, Informalisation and Other Issues - 6.6 Growth and Changing Structure of Employment: “… During these years, we also find a widening gap between the growth of GDP and employment. This means that in the Indian economy, without generating employment, we have been able to produce more goods and services. Scholars refer to this phenomenon as jobless growth. …” |