Middle class consumtion going down, big challenge to create formal jobs, says CII Gujarat chairman

According to him, the one big challenge for the industry and the government was to create jobs. He said that Gujarat would need to create 7 lakh to 8 lakh of the 150 lakh jobs in the country in a year “to take the economy to the next level”.

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Chairman of the Confederation of Indian Industry (CII) in Gujarat and Executive Director of Arvind Limited, Kulin Lalbhai, on Wednesday raised concerns about “middle class consumption” going down and the challenge of creating more “formal jobs”.

Asked about the one expectation not met in the 2024-25 Union Budget at a media interaction on Wednesday, Lalbhai said, “One of the things India needs is to get consumption going. This K-shaped recovery (where some industries rebound and others struggle, especially post-pandemic) is worrying. The middle class has to consume. I think jobs will finally help but it will take time. Is there a way to get consumption going faster — would be the one thing we can think of in the next year or two because the middle class is not consuming.”

He attributed this to reasons like “EMI pressures, indebtedness” and the focus on services rather than goods.

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“People want experiences rather than things so it is a complex topic,” said Lalbhai.

According to him, the one big challenge for the industry and the government was to create jobs. He said that Gujarat would need to create 7 lakh to 8 lakh of the 150 lakh jobs in the country in a year “to take the economy to the next level”.

Of these, the majority need to be “formal jobs”, Lalbhai said, as they “give comfort and security to an individual” and also a very different strength to the economy.

“Anything which goes into an EPFI (Employees Provident Fund of India) is what I am counting as a job,” he told The Indian Express.

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He said his big takeaways from the Budget were “faith in corporate India, fiscal discipline, infra focus, focus on employment and capability gap and skilling”.

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