Kerala Needs Businesses Over Migration to Grow

Kerala, despite having the lowest poverty rate in India and boasting a high literacy rate, the state faces a notable challenge: educated unemployment. A significant number of well-educated individuals encounter difficulties securing employment within the state, leading many to migrate in pursuit of better-paying opportunities. However, a study suggests that the reluctance of educated youth to establish their own enterprises might be a crucial factor contributing to this problem.

Migration from Kerala has a long history, shaped by both economic and political factors. Pre-independence migration was influenced by trade and colonial activities. Kerala’s strategic location on the southwestern coast of India made it a hub for maritime trade with Arab countries, China, and Southeast Asia. This early migration was primarily driven by trade opportunities, with many Keralites settling in the Middle East and Southeast Asia as traders and laborers.

Post-independence, the pattern of migration evolved significantly. The economic downturns and limited employment opportunities in Kerala, coupled with political instability in neighboring regions, led to a marked increase in migration. The 1960s and 1970s saw a significant migration wave to the Middle East, driven by the oil boom, which created substantial job opportunities for Indian laborers, including those from Kerala. This period marked a shift from traditional trade-related migration to labor migration driven by economic needs.

Political changes and instability have also played a role. During the post-independence era, economic challenges and political upheavals in neighboring regions sometimes forced people to seek stability elsewhere. Additionally, internal political factors, such as land reforms and policy changes within Kerala, influenced migration patterns. For instance, land reforms in the 1960s led to significant social and economic changes, pushing many rural residents to seek opportunities in urban areas or abroad.

While migration has provided numerous economic opportunities and benefits, it has also led to a notable brain drain, where highly skilled and educated individuals leave the state for better prospects abroad. This brain drain is particularly pronounced in Kerala due to the state’s high literacy rate and the emphasis on education, resulting in a surplus of skilled professionals who seek opportunities in more developed economies.

The migration of Keralites to countries like the United States, Canada, the Middle East, and Europe often involves professionals in fields such as information technology, healthcare, engineering, and academia. These individuals are attracted by better job opportunities, higher salaries, and advanced research facilities, which offer more significant career advancement compared to what is available in Kerala. The outflow of talent can result in a shortage of skilled professionals in critical sectors within the state, potentially impeding local development and innovation.

Many people in Kerala have a common way of thinking – they believe in getting a job first and then, if things go well, maybe consider starting their own business. The problem with this approach is that many people get so caught up in the routine of working for someone else that they find it hard to break free and start their own business. The idea of leaving the comfort of a job and taking the risk to start something new can be scary and challenging.

Young minds who complain about the lack of competitive jobs within the state seem hesitant to embrace the very idea of creating those jobs themselves. Ironically, it’s this very preference for existing jobs over creating them that causes the problem.

Many Keralite graduates prefer the uncertain path of migration, accepting any job available in foreign lands over venturing into the world of business. This exodus of skilled individuals, often referred to as “brain drain,” deprives the state of its entrepreneurial potential and stunts economic growth.

Why individuals in Kerala are hesitant to start businesses?

One of the major reasons why people in Kerala might not be considering starting their own businesses is because of bureaucratic procedures. Navigating complex regulations, obtaining permits, and securing approvals can be a time-consuming and frustrating ordeal, and often discourages young entrepreneurs from pursuing their ventures. However, when it comes to the state of Kerala, enduring the complexities of these processes might indeed prove to be worth the effort.

As per the latest statistics of the NITI Aayog, Kerala had the lowest poverty rate in the country. Keralites possess exceptional spending capacity, driven by rising income levels and a demand for quality. This presents a fertile ground for business ventures, a reality often overlooked by those fixated on migrating. Recognizing and harnessing this potential can be instrumental in fostering a thriving entrepreneurial ecosystem within Kerala, contributing to sustained economic growth and job creation.

Studies have consistently validated the correlation between strong entrepreneurial ecosystems and economic prosperity. Research by Acs et al. (2008) and Autio et al. (2014) demonstrates that societies with higher levels of entrepreneurship witness better economic growth. These research findings highlight the importance of creating an environment that supports people in starting and running their businesses. It’s not just about new ideas and job opportunities; it’s also about boosting the overall development of a community or region. This is particularly relevant for places like Kerala, where there is a significant potential to encourage a thriving community of entrepreneurs.

While the Kerala government has launched programs like the Kerala Startup Mission (KSUM) to promote entrepreneurship, the lack of awareness of these initiatives among aspiring entrepreneurs is a major problem. Many youth remain oblivious to the comprehensive support mechanisms available to them, ranging from government grants to incubation centers. This information gap hinders their access to resources and guidance, crippling their entrepreneurial ambitions. By recognizing and nurturing entrepreneurship, Kerala has the chance to push its economy forward, creating a cycle of new ideas, job openings, and overall progress in society.

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