Driving Economic Growth: The Vital Role of the Real Estate Sector as the Second-Largest Employer

By LODHA

As India emerges as a global manufacturing hub, it has become crucial to acknowledge the role the real estate industry plays in our economy. The domestic real estate market is responsible for adding economic value by generating employment. In fact, after the agricultural sector, the realty industry is the second-largest employer in the country. The real estate and construction industry has contributed around 11% to the Gross Value-Added growth of the nation since 2011-2012. Real estate in India is now being recognised as the impetus for a lot of the growth and employment taking place in the country. It has also been estimated that almost 50% of India's GDP is connected to the domestic real estate sector. 

Expanding Employment Landscape in Real Estate

Ranked as the second-largest employer in the nation, the industry boasts an impressive workforce of 7.1 crore, substantiating this assertion with significant numerical support. Real estate consultants Knight Frank India released a report titled "'Skilled Employment in Construction Sector in India' in collaboration with the Royal Institution of Chartered Surveyors (RICS). The report assesses growth in the real estate sector and focuses on the current levels and gaps in the sector when it comes to skilled employment. The report also went on to estimate that by 2023 the number of real estate workers employed in the sector was to exceed 10 crores. Additionally, the output generated by the sector is also likely to grow from the current USD 650 billion USD to 1 trillion by 2030. 

The report went on to highlight that growth in the infrastructure and real estate sectors in India will lead to an increased demand for manpower in the industry. The report emphasised that the escalating integration of technology has allowed the sector to adapt. With technological advancement paving the for increased productivity, the demand for skilled workers will see a surge as well. 

However, it is important to note that out of the current mammoth workforce engaged in the real estate sector, only 19% of the workers are skilled employees. The remaining 81% of the workforce is unskilled. The Knight Frand-RICS report touched upon this disparity and stated that since there will be a growing demand for real estate projects and infrastructure development in the coming years, the demand for skilled employees will also rise. Skilled employees will become popular with developers, consulting firms and construction companies. To fulfil this demand, skilled employees will be generated via government initiatives and training centres and institutes. 

To further enlighten upon the nature of the workforce engaged in the real estate sector, it is imperative to consider the estimates laid down by the National Skill Development Council (NSDC). As per the NSDC, around 87% of the total employees are pulled in by the real estate sector whereas around 13% are absorbed by the infrastructure sector. Further, out of the total workforce comprising 71 million employees engaged in the construction industry, around 4.4 million are core-level skilled employees. This group includes technicians, engineers, clericals and so on. On the other hand, 6.9 million are mostly vocationally trained workers. 

With the scope for jobs in property development and real estate increasing, the sector is going to continue to leave a positive impact on the economy. Investing in property can not only add value to your portfolio but also help create real estate job opportunities.