Dr. Susmit Kumar, Ph.D.

The US GDP nearly doubled between 2000 ($10.28 trillion) and 2016 ($18.46 trillion), but instead of increasing good paying jobs, the US lost more than 5 million such jobs during the same period (Chart 1) whereas the job growth was in the low-wage sector ((Recovery Has Created Far More Low-Wage Jobs Than Better-Paid Ones, Annie Lowrey, The New York Times, April 27, 2014). The total number of jobs lost may be two to three times of the factory jobs, if we consider indirectly associated jobs also such as in schools, hospitals, apartments/homes, home repair related jobs, gas/petrol stations, restaurants, grocery shops and auto sector as factory workers would spend their income in these associated fields (please read my article: The Hidden Cost of Imported Items and The Need to Redefine Modi Administration’s “Make in India” Policy). In a small town, if a factory, having couple of thousand workers, closes, it devastates the entire town.

In US, the real estate is considered a parameter to measure the job growth in a region. In US Midwest, real estate collapsed during the 2008 Great Recession and still it has not improved. If you try to sell a home in Midwest, it generally takes 8 to 9 months to sell it and it is sold at about 8% to 10% below the market rate. On the other hand if you try to sell a home in Silicon Valley, California (which has the highest per capita income in US), it would sell within a week or two for 10% above the market value.

Right now there is a discussion on jobless growth in India. If you consider the same yardstick as in US, i.e. the real estate price in India, we find that in last 2 to 3 years, the real estate prices have increased in regions having high-priced homes, but has gone down in regions having middle class homes - there are some exceptions also. For Delhi, home prices have dropped for all types of homes (Noida and Gurgaon are considered separately from Delhi). In fact if you take the inflation into consideration, the home prices decreased in nearly all regions/cities in India in last 2 to 3 years (the data at 99acres website do not consider the inflation). If the inflation was 5% a year, you have to multiply 2016 price by 1.05, 2015 price by 1.10, 2014 price by 1.15 and so on, to get inflation-adjusted home price.

The data is gathered from the website: Property Rates & Price Trends in Delhi, www.99acres.com - you can get prices of homes in all major cities by opting the city name in drop down. Five cities are considered below – Delhi, Mumbai, Chennai, Gurgaon (Haryana) and Noida (UP).

In the charts below, for each city first few are for medium-price homes and last ones are for high-priced homes.

Chart 1.

(source: http://money.cnn.com/2016/03/29/news/economy/us-manufacturing-jobs/index.html)



(A) Delhi









(B) Mumbai








(C) Chennai







(D) Gurgaon (Haryana)








(E) Noida (UP)







Additional information