According to figures from the Centre for Monitoring the Indian Economy (CMIE), India’s jobless rate rose to a one-year high of 8.3 percent in August, as employment plummeted by 2 million to 394.6 million. In July, the unemployment rate was 6.8 percent, and there were 397 million people working.
“The urban unemployment rate is often higher, at approximately 8%, than the rural unemployment rate, which is typically around 7%.” In August, the urban unemployment rate rose to 9.6 percent, while the rural jobless rate rose to 7.7 percent. Mahesh Vyas, managing director of CMIE, said The irregular rains hindered sowing efforts, which is one of the causes of the increase in rural unemployment, he continued.
Rural India’s jobless rate increased from 6.1% in July to 7.7% in August. More notably, the unemployment rate declined from 37.6% to 37.3%.According to Oxfam India’s “The India Discrimination Report,” released Thursday, the unemployment rate in rural India nearly doubled immediately after the coronavirus lockdown was announced, rising from 6.8% in the pre-pandemic January-March 2020 quarter to 12.1% in April-June 2020, the first quarter after the nationwide lockdown was announced. According to the data, the urban jobless rate increased from 9% to 20.8% within the same time period. Unemployment is defined by the government’s Periodic Labor Force Survey (PLFS) as those seeking or available for work.
This definition considers employed the portion of regular/salaried workers and self-employed individuals who did not record any work during the reference week. According to the research, many of them had no employment and no income, but because they were not seeking or available for work, they were considered employed.
“When we widen the criteria to include individuals who reported no work during the reference week as jobless, as well as those seeking for/available for work, the increase in the unemployment rate becomes frightening,” according to the research. “In such a scenario, the overall unemployment rate in rural regions would jump from 10.5 percent to 22.2 percent.” The growth in urban regions is concerning, increasing from 15% to 50.3 percent.
According to both indices, the study also discovered that the increase in unemployment rate was larger among those from the Scheduled Castes (SC), Scheduled Tribes (ST), and Muslim groups than those from the general category. In terms of worker distribution across all kinds of employment, the pandemic had the largest impact on casual employment, which, according to the research, was more severe in urban areas due to the closure of non-agricultural operations. Self-employment has risen in tandem, implying that people have accepted this profession as part of their survival strategy.
In contrast, the survey found that the percentage of regular employment remained constant or decreased somewhat. In comparison to the large growth in self-employment among those from the SC/ST and general categories, the increase among Muslims was extremely tiny. According to the research, this might be attributed to a “reduced acceptability of interacting directly with customers at the home level,” which drove them out of casual employment and into unpaid family work or the jobless category.
While the total unemployment rate for rural areas increased from roughly 9% in the pre-pandemic quarter to 17% in the first quarter after the limitations were announced, it increased from 7% to 10% in the general group over the same period. Using a broader definition of unemployment, the research stated that Muslims in rural regions had the greatest increase in unemployment during the last two quarters, rising from 14% to 31%. According to the survey, the rise in rates for SC/ST and general category populations was 11% to 22% and 10% to 20%, respectively.
According to the survey, “Caste and religious identities become more important in rural communities, especially during times of crisis.” “People are more inclined to behave in their social circles.” Given the SC/ST and Muslim populations’ social and economic weakness, the protection they can supply or request from their group would be limited. As a result, one may expect discrimination to have a considerably bigger influence in rural labor markets than in metropolitan labor markets.
“While the overall impact of the epidemic has been severe in urban areas due to a series of national and state blockades that have directly damaged urban commerce,” the report added, “social prejudice has been less as people’s professional identity tends to hide their caste or religion.”
According to the Oxfam survey, the number of casual and salaried workers who did not report to work for two consecutive quarters increased from 5.9% to 29.7%. The rise in urban areas was startling, rising from 6.9% to 39.4%. This increased from 11.8% in January-March 2020 to 40.9% in April-June of the same year for Muslims. According to Oxfam’s data, the number of women in regular work increased during the April-June 2020 quarter, while male employment decreased.
In the future, the rural unemployment rate may fall as the delayed monsoon increases agricultural activity at the conclusion of the monsoon season. However, it is unclear how the urban jobless rate will evolve over the next few months. It is currently fairly high. According to CMIE statistics, the highest unemployment rate in August was 37.3 percent in Haryana, followed by 32.8 percent in Jammu and Kashmir, 31.4 percent in Rajasthan, 17.3 percent in Jharkhand, and 16.3 percent in Tripura.
According to the report, Chhattisgarh had the lowest unemployment rate at 0.4%, followed by Meghalaya at 2%, Maharashtra at 2.2%, and Gujarat and Odisha at 2.6% apiece. “A high majority of regular female employees in metropolitan areas are engaged as domestic servants and in unskilled employment.” Many of them provided daily support services at a modest cost, which the upper and middle classes saw fit to pay for in full or in part.
According to the survey, average incomes declined considerably across all socioeconomic groups and employment categories in the April-June 2020 quarter. Monthly wages in rural regions were 9% lower than the 2019-20 average during the first post-COVID-19 quarter. However, the gap in metropolitan areas was substantially bigger, at 21%. In rural regions, the Muslim population had the greatest loss (13%), while the remainder fell in line with the national average.