Economic Survey report: Drastic fall in employment generation in MSMEs

Written by Partha Sarathi Biswas | Pune | Published:March 20, 2017 8:15 am

Maharashtra might have clocked an impressive growth rate last year, but when it comes to the Micro Small and Medium Scale Enterprises (MSME), the figures are not so impressive.

As per the Economic Survey 2016-17, the financial year 2015-16 was marked by a dip in employment generated in the sector as well as a four-year low in terms of investments.

Units with investments ranging from Rs 25 lakhs to Rs 1,000 lakhs are normally classified under the MSME sector. Acting mainly as feeder system to the main industries, these units generate almost four time more employment than bigger OEMs. These units are responsible for the prolific growth of industrial township of Pimpri-Chinchwad and areas like Talegaon and Ranjangaon, which have a large number of such units.

Around 37 per cent of the total MSMEs in the state are located in Pune and the 92,233 units in the region generate more than 10 lakh jobs. The Economic Survey paints a disturbing picture in terms of falling investment and closure of MSME units. The last financial year saw Rs 4,090 crore being invested in the sector and 20,220 units being operational. In the financial years 2014-15 and 2013-14 investments were in the tune of Rs 7,180 cores and Rs 6,358 crore respectively.

Financial year 2014-15 was particularly fruitful of the sector as 36,992 units were operational as compared to 19,814 functional units of the previous year.

Employment generation in the sector has seen a nosedive with the last financial year generating only 1.66 lakh new jobs being generated. This would be an all-time low in terms of employment generation since 2007-08. “Up to September 2015, in all 2,43,721 MSME units, with an investment of ` 56,552 crore, generating employment of 29.19 lakh were functioning,” states the survey.

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