Jobless Growth Based on a 2-Digit Industry-wise Analysis for Tamil Nadu: Pre and Post-reform Years: 1984-2006

Analysing the ASI data for the state of T.N. at 2-digit industry level, the paper finds that despite a relative decline in the growth of employment, value added and labour productivity, there is an increase in the employment elasticity (EE) during the post-reform years (1994-2006). Thus, although the post-reform growth in these variables is less than that in the pre-reform years (1984-1993), there is a high-base effect contributing to an increase in employment generated in the latter half of the period under focus. This is reflected in the employment elasticity for 10 out of 14 industries, derived by considering the joint impact of both output and capital on employment. The net effect is, therefore, a significant increase in the employment content of jobs at the ‘all industries’ level. Capital intensity has not altogether affected the employment creation process to give credence to the hypothesis of jobless growth in the state.