Unemployment At An All Time High With 3.1 Crore Indians Without Job: Report
Unemployment has always been a cause of concern in our country and recent numbers reveal that it has been rising over the last few months as it spiked to 7.1% in the week ended February 25, as reported by Quartz.
Around 31 million people in India are currently looking for jobs. This is the highest since October 2016, according to a February 27 report published by the Centre for Monitoring Indian Economy (CMIE), an independent think-tank that tracks business and economic data. The report also says that February 2018 will see the highest unemployment rate in the last 15-16 months.
Rise and fall
According to the report, unemployment was the lowest last in July 2017. Since then, the rate has been steadily rising.
“Given that the recent three weeks have consistently shown unemployment rates at close to 7%, it is possible to infer now that the rate is back to the levels just before demonetisation,” Mahesh Vyas, CEO of CMIE, said in the report. While the absolute unemployment number isn’t alarming, the steady rise is, he added.
The report also states that the rate of unemployment decreased during demonetisation. The reason for the decrease is that the youth was not even trying to look for jobs anymore because of the crippling state of the economy at that point, hence, they were busy acquiring new skills.
During that period, the labour participation rate (the total number of people employed or actively hunting for jobs) hovered between 46% and 48% before demonetisation. By July 2017, it fell to below 43%. Now the CMIE expects it to go past 44% by the end of February 2018.
“The labour force has still not recovered entirely, and remonetisation by the Reserve Bank of India (RBI) was not enough to bring labour participation to its earlier levels,” Vyas said, as reported by Quartz.
While people are slowly coming back to work now, enough jobs have not been added, hence, the rise in unemployment.
Employment opportunities will not be great in the near future too. In addition to the 31 million unemployed as of February 25, urban India will see a spike in demand for jobs as a fresh batch of college graduates enters the workforce in May. But the number of jobs created in the financial year 2018 is an estimated 600,000.
“In rural India, activity will slow down after the rabi crop is harvested. Employment opportunities will be limited till the preparation for the Kharif season begins around mid-May,” the report concludes.