By Faisal Kawoosa
I believe Kashmir needs more ground-level surveys to understand the root causes of the challenges it faces.
Such studies can identify problems, measure their scale, and generate evidence that helps policymakers and advocacy groups make informed decisions.
Employment remains one of Kashmir’s biggest challenges, much like in many parts of the country. Rapid advances in technology, especially artificial intelligence, have made the job market more competitive.
The Jammu and Kashmir government has responded by encouraging young people to explore entrepreneurship and nano-entrepreneurship through its revamped startup policy and initiatives such as Mission Yuva.
Even with a supportive ecosystem, entrepreneurship appeals to only a section of society.
A 2025 SEBI survey found that fewer than 10 percent of Indian households invest in the securities market, with risk aversion emerging among the key reasons. Studies from different countries also show that 65 to 90 percent of people prefer financial stability over uncertainty. That naturally limits the pool of future entrepreneurs.
Entrepreneurship remains an important driver of economic growth because thriving startups strengthen the local economy and create employment.
A rough estimate suggests startups in Kashmir employ three to five people on average, although many early-stage ventures begin with only one or two founders. Even then, startups directly engage well over a thousand people in the valley.
A successful entrepreneur creates opportunities for many others.
The MSME sector remains the valley’s largest employer. Reliable data is limited, but broad estimates suggest MSMEs employ around five lakh people in Kashmir alone.
According to the Ministry of MSME, Jammu and Kashmir has 8.19 lakh Udyam registrations. Assuming a broadly even distribution between the Jammu and Kashmir regions, the valley could account for more than four lakh registered MSMEs.
Those enterprises should generate at least 10 lakh jobs.
But the picture changes because nearly 99 percent of them are micro enterprises, many employing only the owner.
The Union Territory has only 3,220 small enterprises and 215 medium enterprises.
These figures reveal an important trend. The organised sector is expanding in Jammu and Kashmir, but much of that growth comes from micro businesses with limited capacity to generate large-scale employment.
MSMEs employ more people than the government, though government jobs continue to enjoy greater public confidence because they provide stability, predictable income, and clear career progression.
MSMEs in Jammu and Kashmir, especially in the valley, have spent years operating through economic and political uncertainty. That experience has shaped the quality of employment they provide. Many businesses function without structured HR policies, career pathways, performance reviews, or professional development opportunities.
Greater structure can change that. Reliable employment, fair workplace practices, and opportunities for growth would make MSME jobs far more attractive for young people.
The government’s role in employment continues to evolve. Administrative reforms and technology have gradually reduced the scope for expanding the public workforce.
This shift also creates an opportunity.
Government can partner with MSMEs to help create reliable workplaces for lakhs of employees. Stronger private-sector jobs can gradually earn the same public confidence enjoyed by government employment.
A broader shift is also taking place in Kashmir, where young people increasingly seek meaningful work alongside a stable income. Earlier generations often viewed government jobs mainly through the lens of financial security and long-term stability.
Gen Z brings a different outlook.
Merit, honest earnings, and professional growth hold greater value for many young people today. That change creates a strong foundation for redefining what makes a good job in Kashmir.
So how can the government co-create these jobs and bring greater reliability and structure to employment in MSMEs, especially micro enterprises?
Labour laws, minimum wage provisions, provident fund benefits, and state life insurance schemes already exist. Their application, however, depends on eligibility criteria, while loopholes often delay or weaken implementation.
These practices remain common and leave many workers without meaningful protection.
The biggest challenge lies with resources. Most MSMEs operate with tight budgets, making additional compliance or employee benefits appear like an added expense rather than a long-term investment.
The government faces its own financial constraints. In the past, governments created jobs partly to expand economic opportunities, even when the work itself remained limited. Those decisions often highlighted welfare priorities.
That approach has become increasingly difficult to sustain now.
Financial pressures have encouraged greater reliance on ad hoc appointments, contractual staff, and daily wagers. Many people spent years in these roles, but recognition, security, and career growth remained out of reach.
MSMEs already generate employment, though many struggle to provide the stability people expect from a long-term career. The government, meanwhile, can strengthen these jobs through well-designed welfare measures at a much lower cost than creating new public-sector positions.
Personal observations suggest that more than 95 percent of MSME jobs pay less than Rs 10,000 a month. Salaries often remain unchanged for years, leaving little room to absorb inflation or build savings. Government support could change that picture.
Imagine an employee earning Rs 6,000 a month. A government contribution of Rs 3,000 each month into a mandatory savings fund would help that worker accumulate nearly Rs 1 lakh within three years.
Those savings could support a child’s education, help build a home, or meet other major family expenses.
Over a 30-year career, the same worker would accumulate well over Rs 10 lakh, creating financial security that remains out of reach for many low-income households.
Financial support alone will not solve the problem. Structured HR policies should become part of the package.
Clear guidelines for annual appraisals, salary revisions, and career progression would encourage professional growth and reduce stagnation.
An annual government contribution of Rs 35,000 to Rs 40,000 per employee could help build reliable and progressive employment through MSMEs.
That amount remains far lower than the cost of creating many temporary public-sector jobs, while producing stronger long-term outcomes for workers and businesses alike.
Implementation depends upon thoughtful regulation. Free-market principles encourage governments to stay outside day-to-day business operations, a view long associated with economists such as Adam Smith and Milton Friedman.
Governments, however, already support businesses through subsidies, interest subventions, and several incentive schemes.
And that support creates an opportunity.
Any MSME receiving direct financial assistance from the government could adopt basic HR standards as part of the programme. Those standards could include performance-linked growth, transparent workplace policies, and mandatory employee savings.
Such measures would strengthen workplace esteem while giving employees greater confidence in their future.
Creating large numbers of government jobs no longer appears financially practical, but building stronger partnerships with MSMEs presents a more sustainable path.
Reliable jobs, opportunities for growth, and rewards linked to performance would strengthen confidence in the private sector.
Kashmir already faces difficult questions surrounding the regularisation of daily wagers, reservation policies, and rising drug abuse among young people. Practical employment policies can address part of that challenge by creating stable opportunities that match present realities.
Suppose one lakh MSME workers receive support worth Rs 40,000 a year. The government’s annual contribution would total Rs 400 crore, while Rs 360 crore would flow directly into long-term savings for employees.
That investment would strengthen the financial security of nearly five lakh family members who depend on those incomes.
The government can achieve far greater impact by strengthening employment where jobs already exist.
Focused support for MSMEs would help businesses grow, improve the quality of work, and give lakhs of families greater financial security, all at a fraction of the cost of expanding government payrolls.
- The author is the chief analyst and co-founder of Techarc, and a leading voice on India’s technology industry. He advises businesses and policymakers on emerging trends, and serves on the jury of the GLOMO Awards at the Mobile World Congress in Barcelona.