Why Nagaland Has the Highest Unemployment Rate and How We’re Actually Making It Worse

Let me explain how due to our own counter-productive policies as a state, our society and government is incentivizing declaring oneself as Unemployed. In a state blessed with an abundance of talent, creativity, and entrepreneurial spirit, Nagaland consistently ranks at the top of the unemployment charts. According to the Centre for Monitoring Indian Economy (CMIE) data for 2024, Nagaland’s unemployment rate hovers above 20%, making it the highest in India. But scratch beneath the surface of these statistics and you’ll find a deeper and more troubling story—one where policy, perception, and paperwork are locking horns in the most absurd way possible.

The Curious Case of the Unemployment Certificate

Let me take you to a recent scene that played out like a dark comedy. The government had introduced a scooty taxi scheme—an effort to promote self-employment by issuing licenses to educated, unemployed Naga youths. Admirable in intention. But here's the twist: the main eligibility criterion was the possession of an Unemployment Certificate.

And thus a mob of youths summoned by bureaucracy, hundreds of young men and women line up outside employment exchanges not for jobs—but for certificates affirming that they don’t have one! That’s the irony of policy with good intent gone wrong.

Now pause for a moment and think about this – Aren’t these youths self employed? And not unemployed? Shouldn’t the requirement have been something like - Provide a Self-Employment or a MSME Udyam Registration Certificate? Instead, we’ve built a policy ecosystem where being officially unemployed is the golden ticket to unlock Government schemes and benefits. Instead, government should be encouraging people to get self employment and MSME registration. In other words: We are incentivizing unemployment on paper.

When "Jobless" Becomes a Strategy

In any other rational economic ecosystem, a self-employed youth—whether a carpenter, tailor, IT freelancer, or basket weaver—would be celebrated as a micro-entrepreneur. But in Nagaland, that same person is nudged by family and society to get an unemployment certificate. Why? Because it opens up doors: subsidies, schemes, training programmes, taxi permits, you name it. We must abandon the ignorant ways where only government job is considered as employed which creates a paradox – employed yet unemployed.

Even some parents are complicit, encouraging their children to remain "officially unemployed" just long enough to get access to government support.

Unpacking the Data Fallacy

This is where the statistics become dangerous. Because the CMIE and other agencies rely heavily on survey-based data, and when youth voluntarily identify themselves as unemployed for strategic benefits, they inadvertently inflate the very metric that we’re trying to reduce. So what we have in Nagaland is a false unemployment epidemic, manufactured by our own incentives.

And this is not a fringe case. In a 2023 sample survey conducted by a civil society group in Dimapur, it was found that 38% of those who declared themselves as "unemployed" were in fact engaged in income-generating activities, from tailoring and plumbing to online tutoring and YouTube content creation. Yet their Unemployment Certificates say otherwise.

Fixing the Policy Rot: What Can Be Done?

If we want to bring sanity back to the system—and honesty back to the statistics—we need to reform both the language and logic of employment support schemes.

Here’s what must be done:

1. Abolish the Unemployment Certificate System

Let’s call a spade a spade. This colonial relic needs to go. Instead, introduce:

·         Self-Employment Declarations

·         Udyam or Start-Up Registration

·         Local Body Endorsement for Active Work Engagement

This flips the narrative from victimhood to value creation.

2. Incentivize Formalization of Work

Use subsidies and tax breaks to encourage registration of private enterprises, home-run businesses, and gig work. Platforms like MSME registration should be streamlined and integrated into all skill-based schemes. RAMP programme is a great opportunity to address this gap.

3. Employment Exchange Reform

Let employment exchanges act as career facilitation centres—tracking real-time skills, matching private sector demand, and facilitating placement—not just as rubber stamp counters for unemployment certificates but encouraging youths to go for self-employment Udyam registration as an MSME for those who are self-employed or running business ventures.

4. Data Modernization

Revamp the data collection framework. We need to distinguish:

·         Voluntarily unemployed

·         Self-employed

·         Informally employed

·         Underemployed

This clarity will sharpen both policymaking and funding allocation.

Final Thought: Reframing Dignity

In Nagaland, we often say, “Work is work, no matter the shirt.” But our policies sometimes forget that. If our youth are driving scooty taxis, crafting furniture, building software, or running home bakeries—they are working, not waiting, not unemployed. Let’s stop rewarding declarations of helplessness, and start celebrating declarations of hustle, productivity and industriousness. Let us build and move towards a new Nagaland where we celebrate those who are working and being productive instead of being proud of holding an unemployed certificate and waiting for that uncle who had promised some backdoor appointment. We need to re-build a society which takes pride and dignity in hard work!

Until then, as long as we keep telling our youth to stand in line to prove they’re doing nothing, we’ll keep showing up as India’s top unemployment statistic. Now if that doesn’t make your policy alarm bells ring, I don’t know what will. Our goal as state should be to bring down this inflated unemployed rate in the next 2 years.

Yanpvuo Kikon

Policy Analyst Consultant, Entrepreneur & Proud Naga Troublemaker (for the right causes)