Tag Archive Unemployment

SBI report says rural economy is losing steam, flags rising unemployment and fall in wages

For 12 Indian states, the loss in state GDP in the current fiscal is mainly due to the rural areas, says the research report by State Bank of India.

REMYA NAIR 3 September, 2020 7:37 pm

Representational image | Commons

New Delhi: India’s rural economy may be losing steam after leading the economic recovery in the first few months of the pandemic, a research report released by the State Bank of India said.

Rural unemployment rate has started rising again in August, while employment and average wages under the national rural employment guarantee scheme have fallen, the report released Thursday said (see graphic).https://5a91b5bb29ce6311ce3f9fd4b71d7416.safeframe.googlesyndication.com/safeframe/1-0-37/html/container.html

Graphic: Soham Sen
Graphic: Soham Sen
Graphic: Soham Sen
Graphic: Soham Sen

The report also pointed out that for 12 Indian states, more than two-thirds of the loss in gross state domestic product (GSDP) in the current fiscal was contributed by rural areas.

Chhattisgarh, Assam, Himachal Pradesh, Bihar, Odisha, Andhra Pradesh, Telangana, Uttar Pradesh and Madhya Pradesh are among the states that are seeing a substantial loss in the GSDP contributed by rural areas.

According to the report, in states like Chhattisgarh, Assam and Himachal Pradesh, more than 90 per cent of the GSDP loss is from rural areas. Bihar at 86 per cent, Odisha at 84 per cent, Uttarakhand at 79 per cent, Rajasthan at 75 per cent, Andhra Pradesh, Telangana and Madhya Pradesh at 71 per cent and Uttar Pradesh at 65 per cent are among the other states with high output losses from the rural sector.

Agriculture was the only silver lining

The report’s findings come at a time agriculture and rural demand are expected to be the only silver linings for the Indian economy battling Covid-19 and the economic impact of the initial two-month lockdown as well as the intermittent lockdowns announced by many states to curb the pandemic.

The GDP data released last week had also shown that agriculture was the only sector that reported a positive growth at 3.4 per cent in the April-June quarter. Other sectors such as construction, manufacturing, and hotels and transport had reported sharp contractions by 50 per cent, 39 per cent and 47 per cent, respectively.

The RBI, in its annual report released last month, had also pointed out how urban consumption demand has suffered a bigger blow than rural demand. Citing tractor sales and motorcycle purchase data, it had pointed to improved rural recovery but added, “A fuller recovery in rural demand is, however, being held back by muted wage growth which is still hostage to the migrant crisis and associated employment losses.”

It had expressed hope that increased employment generation in rural areas under the Pradhan Mantri Garib Kalyan Rojgar Abhiyaan and increased wages under the Mahatma Gandhi National Rural Employment Guarantee Act would provide a fillip to rural incomes.

The SBI, in its report, however, said mixed signals are emerging.

Tractor sales and two-wheeler sales increased in July and August but fertiliser sales and diesel consumption declined in recent months, the report said.

India’s unemployment rate doubled in two years: SoE in Figures


While unemployment remains high in both urban and rural India, job hunting is a bigger challenge for the young and the educated, notes CSE’s State of the Environment in Figures

Last Updated: Thursday 06 June 2019

Representational Picture. Photo: Getty Images

Representational Picture. Photo: Getty Images Representational Picture. Photo: Getty Images
India’s rate of unemployment doubled in the past two years, according to the State of India’s Environment (SoE) In Figures, 2019. This has particularly affected young graduates.
According to the report, the unemployment rate has gone up from four per cent to 7.6 in the last two years (May 2017-April 2019). The unemployment rate in April 2019 was the highest in two years. The rate for rural areas in this month was also the highest in this period.
SoE in figures was released by Delhi-based non-profit Centre for Science and Environment (CSE) on World Environment Day. The data for it has been provided by the Centre for Monitoring Indian Economy (CMIE), New Delhi.
SoE 2019
Young Indians (aged 15-24 years) constitute nearly a fifth of India’s total population, according to the country’s 2011 Census. By 2020, they are predicted to make up a third of the country’s population.
The report notes that the youth (between 20-24 years), who constitute around 40 per cent of India’s labour force, have an unemployment rate of 32 per cent.
The unemployment rate among the educated is even worse. The rate among people with at least a graduate degree was 13.17 per cent in September-December 2018, up from 10.39 per cent in May-August 2017.
SoE 2019The Periodic Labour Force Survey for 2017-18 released by National Sample Survey Office too shows that unemployment rate increased with education level.
According to SoE in Figures, 2017, a major cause for high unemployment rates in India is the lack of skills required for jobs that are available. This is worrying because India is a young country — home to 20 per cent of the world’s young population — and a major portion of this young workforce, though educated, is unskilled.
Official figures validate this. The Union Ministry Of Skill Development and Entrepreneurship says 4.69 per cent of India’s total workforce is formally skilled, as against 52 per cent in the United States, 68 per cent in the United Kingdom, 75 per cent in Germany, 80 per cent in Japan and 96 per cent in South Korea.
So why do young, educated Indians have poor job skills? One reason is that India has a limited number of quality institutes in spite of growth in the number of higher education providers.
A ray of hope
The World Bank recently estimated that India needs to create 8.1 million jobs a year to maintain its employment rate, which has been declining.
Given India’s demographic dividend and urgency to create jobs, the manufacturing sector could prove to be a large employer that provides decent income opportunities.
For example, rapid modernisation of the food processing sector could be one way of increasing its export potential as well as improving employment elasticity-to-growth and investment in it.
With a rise in per capita income, domestic demand for processed food would also rise, making the sector a viable option for pushing manufacturing growth and employment.
Removing structural bottlenecks to the manufacturing sector is key to promoting job creation in more productive and better-paid activities, according to an OECD report on economic outlook released in May 2019.
The International Labour Organization predicts India will have 18.9 million jobless people in 2019. Even as India’s economy is projected to grow 7.5 per cent by 2020, will this growth translate into jobs?
Santosh Kumar Gangwar, who took charge as the Minister of State (Independent Charge) for Labour and Employment in the newly elected government, has a tough job ahead.

It is official: Unemployment rate in rural, urban India highest in 47 years

Joblessness cuts across various demographic groups, says official report


Last Updated: Tuesday 04 June 2019

Photo: Getty Images

Photo: Getty Images Photo: Getty Images
The latest Periodic Labour Force Survey (PLFS) states that the unemployment rate (UR) in both rural and urban India is at its highest since 1972.
The unemployment rates among men and women in both rural and urban groups, are also the highest ever. The increase in the UR is more than three times among rural men and more than double among rural women according to the usual status since 2011-12.
In urban areas, the UR among men is more than twice and has increased twice among women since 2011-12. It is to be noted that the UR between 1972 and 2012 was almost static or did not have many differences (See Table 1). Besides, the UR rose sharply among youth of ages between 15-29 years and those who got better education.
The measurement of unemployment is based on the Usual status and Current Weekly status. The Usual Status (ps+ss) approach to measuring unemployment uses a reference period of 365 days i.e. one year preceding the date of the survey of the National Sample Survey Organisation (NSSO) for measuring unemployment.
The Current Weekly Status (CWS) approach to measuring unemployment uses seven days preceding the date of survey as the reference period. A person is considered to be employed if he or she pursues any one or more gainful activities for at least one hour on any day of the reference week.
The Union Ministry of Statistics and Programme Implementation had constituted PLFS under the chairmanship of Amitabh Kundu. The data was collected by NSSO from July 2017 to June 2018. The survey was spread over 12,773 first-stage sampling units (7,014 villages and 5,759 urban blocks) covering 1,02,113 households (56,108 in rural areas and 46,005 in urban areas) and enumerating 4,33,339 persons (2,46,809 in rural areas and 1,86,530 in urban areas).
The unemployment rates in urban areas are higher than those in rural areas. In rural areas, the UR is 5.3 per cent, whereas in urban areas, the UR is 7.8 per cent according to the usual status. The overall unemployment rate is 6.1 per cent in India according to the usual status. According to CWS, the rural employment rate is 8.5 per cent whereas the urban rate is 9.6 per cent. The overall unemployment rate is 8.9 per cent.
In urban areas, the unemployment rates for females are higher than those for males.

Table 1: Unemployment rate (in per cent) according to the usual status and current weekly status from 1972-73 to 2017-18

Table 2: Unemployment rate (in per cent) among youth (15 to 29 years) in usual status during 2004-05, 2009-10, 2011-12 and 2017-18
The unemployment rate among youth between 15 and 29 years has risen sharply since 2011-12. Among rural males and females, the UR is almost three times since 2011-12, whereas among urban males and females, this rate is more than double.
The UR has also sharply increased among those who are more educated. Since 2011-12, the UR among rural males has increased by almost three times, from 1.7 per cent to 5.7 per cent. Those who have higher degree of education and those who are completely not-literate have witnessed almost the same level of unemployment.
Interestingly, unemployment among rural not-literate females has reduced and among urban females, the number of those who are literate up to primary-level jobs, is the same as 2011-12. (See table below)

Table 3: Unemployment rates (in per cent) according to usual status for the persons of age 15 years and above with different educational attainments during 2004-05, 2009-10, 2011-12 and 2017-18
Among social groups, the highest UR is among the ‘General’ or ‘Others’ category — 6.7 per cent. This groups is followed by Schedule Castes (6.3 per cent), Other Backward Classes (6 per cent) and Scheduled Tribes (4.3 per cent).
Among religious groups, Christians have the highest UR in both urban and rural areas. In rural areas, Christians have a UR of 7.4 per cent, Muslims have a UR of 6.5 per cent, Sikhs 6.3 per cent and Hindus 5.2 per cent.
In urban areas, Christians have a UR of 11 per cent, Sikhs 9.1 per cent, followed by Muslims 8.5 per cent and Hindus 7.6 per cent.

Unemployment among rural youth at highest level since 93-94

Unemployment among rural youth at highest level since 93-94

In rural areas, Kerala had the worst record with 21.7% of its youth unemployed followed by Assam with about 15%
Unemployment among rural youth at highest level since 93-94
Rural unemployment was about 4.7% for both rural males and females in 2009-10. In 1993-94, 3.5% of rural young men in the labour force had no jobs. The corresponding figure was 1.9% for young women in rural areas. Photo: Mint
New Delhi: Joblessness among the youth aged 15 to 29 years in rural areas has hit the highest level since 1993-94, official five-yearly survey data shows, raising potentially difficult questions for the Congress-led United Progressive Alliance government just months before the Lok Sabha polls are due.
About 5% of rural young men and women remained without jobs in 2011-12, a new report on the 2011-12 survey released on Friday shows.
Rural unemployment was about 4.7% for both rural males and females in 2009-10. In 1993-94, 3.5% of rural young men in the labour force had no jobs. The corresponding figure was 1.9% for young women in rural areas.
Experts said a rising trend in the unemployment rate in rural areas could indicate a structural shift in the labour market that policymakers have not adequately addressed.
“These data are very worrying because they show how the declines in agricultural employment have not been met by rising jobs in other activities, since only construction has shown a significant increase. So there are few options for the growing number of youth who have gone through more secondary and tertiary education. What is even more shocking is how little the government is responding to these trends with any sense of urgency,”said Jayati Ghosh, professor of economics at Jawaharlal Nehru University. Workforce in agriculture fell below 50% for the first time in 2011-12.
The proportion of workers engaged in agricultural activities fell from 81% in 1977-78 to 63% in 2009-10 to 59 % in 2011-12 for rural males and from 88% in 1977-78 to 79% to 75 % in 2011-12 for rural females, the National Sample Survey Office’s survey reports show.
Pronab Sen, chairman of the National Statistical Commission, said it could be that enough jobs to absorb raw youth are no longer being created.
The report said, “Over the years, there has been considerable increase in the proportion of workers engaged in ‘construction’. Between 1977-78 and 2011-12, the increase in the proportion of workers in ‘construction’ was about 11 percentage points for rural males, 6 percentage points for rural females, 7 percentage points for urban males and 2 percentage points for urban females.”
In rural areas, Kerala had the worst record with 21.7% of its youth unemployed followed by Assam with about 15% and Uttarakhand with about 11% youth unemployed.
In urban areas, Jammu and Kashmir had the highest proportion of unemployed young persons at 18.7%, followed by Assam and Kerala.
To be sure, higher unemployment among youth, particularly educated youth, has always been higher when compared to the overall average of all age groups.
The unemployment rate among educated youth was 8.1 % for rural males, 15.5 % for rural females, 11.7 % for urban males and 19.8% for urban females, the report said.
The trend of urban unemployment rates, in general and for youth, being higher than those in rural areas continued in 2011-12.
But, the trend over time has been more mixed in urban areas, where although it has declined to its lowest level since 1993-94 for young women to 13.1%, it rose from its all time low of 7.5% in 2009-10 for young men to touch 8.1%.
The rise in joblessness holds true when statistical investigators ask persons about their employment status in the one year till the survey, or their usual principal and subsidiary status.
However, unemployment by current daily status, where statistical investigators ask persons about their employment status on each day of the week before the survey, has declined since 1993-94 for all areas.
The report said the difference between the two measures of unemployment reflected, among other things, intermittent employment.