Several industries are undergoing heavy losses amid the COVID-19 pandemic. Thousand have lost their jobs, and reviving the markets, severely affected by the pandemic, is going to be the biggest economic challenge of the upcoming year according to the government.
According to the Centre for Monitoring Indian Economy (CMIE) survey, consumer sentiments dwindled for the first time in May. Households were also less enthusiastic about buying consumer durables. The survey also revealed that the Index of Consumer Sentiments fell from 52.5 per cent in October to 51.8 per cent in November.
"November 2020 saw a fall in employment and also a fall in household incomes. This double whammy has hurt consumer sentiments," said Mahesh Vyas, MD and CEO of CMIE as reported by The Print.
The CMIE data has further shown that the unemployment rate peaked at 27.1 per cent in the first week of May when the country was under lockdown. The lowest was 5.45 per cent, which was reported in the first week of November as the restrictions were eased. However, the number doubled to 10.1 per cent in December.
In November, the finance ministry's report mentioned that the news of the vaccine being circulated in the country has added to the growing optimism. However, a surge in the number of cases after the festive season could put the economy in danger.
Further data from the CMIE report revealed that the formal sector, which constitutes up to 10 per cent of the domestic labour market witnessed 2-3 million jobs being lost within six months since the first lockdown was imposed.
This estimate was formulated based on the subscription data from the Employees' Provident Fund Organization (EPFO) and the Employees' State Insurance Corporation.
"The biggest worry, however, is not the shrinking of the labour market but the collapse of good jobs," said CMIE Managing Director and Chief Executive Officer Mahesh Vyas. The total employment in the country dropped from 403.9 million in 2019 to 393.6 million by November 2020.
Women's employment also showed a significant decline in the year 2020. According to the report, although the labour participation of women is very low at less than 11 per cent as compared to the 71 per cent for men, they face a much higher unemployment rate of 17 per cent as compared to the six per cent faced by men.
"Also, women suffered a 13.9 per cent job loss in April 2020. By November 2020, men recovered most of the jobs that were lost. However, women were less fortunate", said a CMIE report.
When the lockdown first began, the main reason for the 'shift of migrant labourers' was that most of them were a part of the unorganised sector. Their health was also at risk due to the pandemic.
However, what they now face is a scenario where the market for jobs has shrunk in the cities, and good quality jobs have shrunk even further. With the hope of having an affordable vaccine, a lot of labourers may return in 2021, hoping for better wages and job security. Nevertheless, the new labour laws that will come into force from April 1 is what awaits all of them.