The data from the Centre for Monitoring Indian Economy (CMIE) indicates that unemployment in India may be at a two-year high at 7.2 percent. At the same time, the labour participation, that is the proportion of the population looking for jobs, has also fallen. The report explains that at the core of the problem is fewer job opportunity, which in turn, lead to lower wages.
Mahesh Vyas, CEO and Managing Director of CMIE, said that 2018 was the worst year. “We did see a fall in job opportunities from November 2016, but that’s after demonetisation, 2017 was bad, but 2018 was much worse than that,” he said.
He also said that the most distressful part is the large scale "discouraged unemployment", which means that “people have come to the labour market, tried to get a job, did not find one, tried for some more time and then gave up."
“These people leave the labour market and they don’t even call themselves unemployed, they just leave the labour market.”Mahesh Vyas, CEO & MD of CMIE
"The situation is very grim," Vyas added. The unemployment rate is rising on a falling labour participation rate, what this means is that lesser people in proportion terms are coming into the labour market, and even these people in proportion terms who are coming into the labour markets are increasingly not finding jobs, he elaborated.
The data was released on Tuesday, 5 March, by the CMIE and is based on tens of thousands of households in India.
Vyas has earlier told Reuters that the number of employed persons in India was estimated at 400 million in February compared with 406 million last year.
According to the National Sample Survey Office’s (NSSO), India’s unemployment rate was at a 45-year high of 6.1 percent during 2017-18, according to the periodic labour force survey (PLFS), reported Business Standard.
The unemployment rate in India was at its highest in 2017-18 since 1972-73, the period since data about jobs is comparable, Business Standard said, quoting documents they had accessed.
(With inputs from Reuters, Business Standard)
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