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According to research scholars, middle class income of the west has been on a steady decline since the 70s. This has a direct correlation with the onset of digital revolution; the number of workers laid off in America is almost equally proportional to the number of jobs outsourced to India and other Asian countries. Even though this has led to increase in jobs for the east, it is occurring at the cost of the working class of the west. This in turn has led to the resurgence of the middle class income in India.

Reports suggest that India accounts for 3% of the global middle class with 23.6 million people. It has the lowest threshold for a person to be considered middle class with annual wealth of $13,662 (Rs 737,748 or Rs 61,480 per month). As a result, the number of people under the folds of the middle class group has risen exponentially; in fact, NCAER suggests that by 2025-26 the number of middle class households in India is likely to more than double from the 2015-16 levels to 113.8 million households or 547 million individuals.

However these statistics do not necessarily wave a flag of success for India since outsourcing provides an incomplete picture. Careful analysis shows that within the Indian context, more labour force is being laid off than outsourced. This in turn presents a mirage of job creations in India to the general public.

Taking a magnifying look at the performance of technological innovation within India shows that though Digital India has upgraded the state and volume of mass production back home, it has led to jobless growth in the economy. This is to say that the increase in production is not because of the increase in number of working hands but hike in the amount of auto-pilot machineries. Some scholars are of the view that this rapid digitalisation is actually leading to automation of routine work, laying off more workers by the day while also aiding employees involved in creative non-routine tasks. As a result, this brainchild of global digitalisation has culminated in biased growth.

Another interesting thing to note is that during the industrial revolution (the first wave of capitalism), change in methods and modes of production lead to the voluntary uprooting of population where workers would leave their hometowns by choice in search of new job opportunities, the 21st century digital revolution (arguably the second wave of capitalism), however, has led to migration of the labour class out of compulsion, this can be seen in the bulk mobility of working class in India as well. Where new employment opportunities were the driving force at the time of industrial revolution, the dearth of the same is the driving force this time around.

The real question that arises is how to transition from biased growth to inclusive growth that offers a solution to the pressing issues of demographic imbalances, unemployment and poverty.

The key is to understand that education and technology are not trade-offs. Both sectors complement each other and are crucial for moving towards inclusive growth. Studies have shown that more and more jobs are being taken up by people who have a college undergraduate/postgraduate degree because of the skills that demand working a technological apparatus.

Currently, India spends approximately 4% of its GDP on education in a political environment where all policies and schemes under the Modi government are being digitally oriented. This widens the gap between beneficiaries and participants in a society as the lack of education to tap technology and avail benefits of government schemes defeats the purpose of such schemes and therefore are unable to transform themselves into participants in the system. Furthermore, the lack of employees with adequate skill-set to engineer machineries perpetuates jobless biased growth in the short run and income inequalities in the long run.

Achieving progress in contemporary times requires taking policy steps to put education and technology at shoulder length and realising that prioritising either over the other will only worsen the imbalance of economic positions people have, across the globe.

The greater picture that necessities paying attention is the intricate two-way relationship between politics and digital revolution. In this time and age of hyper globalisation, digital revolution is shaping politics at a faster rate than the latter is shaping the former. From eKranti to mobile connectivity to National Rural Internet Mission, the examples of government rethinking the policy space within the boundaries of Digital India are rampant. Though technological progress has made our lives easier, some balance needs to be maintained on this two-way street of politics and digital revolution.

 

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Written By Marisha Kashyap

Pursuing B.A. Honours in Economics from Lady Shri Ram College for Women, have a keen interest in Public Policy.

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