Social Groups and Unequal Employment Opportunities in Skilled Occupations in India

Differential labour market outcomes are a major concern in the Indian labour market. This article looks into the caste and ethnicity-based employment gap in skilled jobs in India. The study has used data from two Periodic Labour Force Survey rounds, namely the 2021–2022 round and 2018–2019 round. The employment gap has been decomposed using the non-linear decomposition method. The results suggest that socially forward groups are more likely to participate in skilled jobs than socially backward classes. Moreover, a significant part of the employment gap remains unexplained by characteristic differences, including differences in endowments. However, both the employment gap and the contribution of discriminatory hiring practices are generally less in more skill-oriented jobs. The employment gap in high-skilled occupations is significantly explained by differences in productivity factors. The jobs requiring higher levels of skills are largely prevalent in the public sector that comes under the reservation policy. In the private sector as well, compared to low- or unskilled jobs, high-skilled occupations are more likely to be found in the form of formal jobs to which anti-discrimination laws may be applicable. Low-paying unskilled jobs are mainly dominated by socially backward-class workers in the Indian labour market.