Jobless Growth And Middle Class Crisis : Increasing Closure Of MSMEs And Resulting In Loss Of Lakhs of Jobs .
Rajiv Upadhyay
Educated Middle Class, specially the service class, is in serious crisis due to continuous neglect in last decade due to serious erosion in purchasing power and loss of jobs for highly educated class .
One important reason for this is the continuous closure of large number of Small Scale and MSMEs . A comparison of capital required to create 100 jobs in various types of industries is given below ( CGPT)
1. Estimated capital required per job in India
The following are indicative planning estimates for manufacturing industries in India, expressed in 2025–26 rupees. They are not official averages for each category.
| Industry category | Illustrative capital required per job | Investment required for 100 jobs | |
|---|---|---|---|
| Small-scale, labour-intensive industry | ₹2–10 lakh | ₹2–10 crore | |
| Small-scale, machinery-intensive industry | ₹10–25 lakh | ₹10–25 crore | |
| Medium-scale industry | ₹10–40 lakh | ₹10–40 crore | |
| Large-scale, labour-intensive manufacturing | ₹15–50 lakh | ₹15–50 crore | |
|
As per the statement of minister in parliament , the number of MSMEs closed in last four years have more than quadrupled as given below.
The data shows a concerning upward trend in MSME failures over the past five years. Beginning with just 175 units closing in FY21, the number increased to 6,222 in FY22, followed by 13,290 in FY23, and 19,828 in FY24. In 2025 it increased to 35567. Minister for MSMEs Jitan Ram Majhi in the Lok Sabha had indicated that approximately 3.18 lakh jobs were lost due to 49,342 enterprise closure .
However as per independent sources like Myfintex, 108025 MSMEas were closed in two years 23and 24 . A MSME that lowers shutter is really closed but govt waits for legal dissolution . Therefore the actual job loss is humongous.
The number of small scale closure is even more huge leading to even more jobs . The real increase in jobs is very small compared to need .
Retail on line sites like Amazon / Flipkart are giving very low wage delivery boys jobs but they are seasonal and short term contract jobs . With Big Bazar / Sony Stores type are being closed due to deep discount by online sellers .
In addition, high cost credit , risky supply chains , low demand are also the cause . Dehradun’s tiny lamps or Firozabads’s glass works have closed and are now selling Chinese goods . But manufacturing creates far more jobs than trading . Once upon a time certain sectors were reserved for Khadi/small scale / MSME s which was a great help. This serious problem is not being given the attention it deserves.
Demonetisation destroyed the construction industry which was a huge job provider , Shift of parling investible funds in stock market does not create real value like Real State . Due to PM Housing scheme it has recovered partly now but is focussing on just luxury homes for super rich .
The government has borrowed the glib terminology large industrialists and lecturing to promote enterprises or pakoda selling not realising that we never produce Steve Jobs and Elon Musks . National character does not change in a day.
It is living and making youth in a make believe world .
As Palki Sharma once said People do not eat GDP , they eat food which is becoming very expensive .
Large scale industries are a great national assets like refineries and ports etc . Their importance cannot be understated .
But big industrialists and dookandars, rich by selling Chinese goods have totally hi jacked the government attention and resources making middle class an orphan in the present time .
This needs to be immediately rectified . Engineers , scientists , doctors , armed forces , police contribute much more to nations progress and just for ‘ party chanda ‘ should not be abandoned in favour of traders.
We need a new approach.
