New Delhi: India’s unemployment rate reached an appalling high of 8.5 per cent in October, the highest since August 2016, revealed a recent study released by the Centre for Monitoring Indian Economy (CMIE).
The slump down of job growth is despite the government’s pool of measures to increase demand, and it is being looked at as a direct result of the country’s slowdown in economic growth.
Further, India’s infrastructure output also dropped 5.2 per cent in September from last year, showing the worst performance in years by the eight-core infrastructure industries that also saw an output contraction in the last few months.
Another study revealed that the total employment has declined by 9 million between 2011-12 and 2017-18 resulting in an ‘unprecedented’ trend.
An academic paper released on October 31 under the title India’s Employment Crisis: Rising Education Levels and Falling Non-agricultural Job Growth by Santosh Malhotra and Jajati K Parida, revealed that the total employment for 2017-18 was at 465 million, down from 474 million in 2011-12.
“The Indian economy is passing through an important phase of structural transformation, in which, the share and number of workers in agriculture has been declining with corresponding rise in employment in non-farm sectors since 2004-05,” the study read.
“Despite several government initiatives to formalize the economy, still about 90.7 percent (83.5 percent within non-farm sector) of total employment is informal, an insignificant reduction from 93 per cent,” it read further.
The paper is based on the recent survey data of the National Sample Survey (NSS), namely, ‘Employment and Unemployment’ and ‘Unincorporated Non-Agricultural Enterprise’.
Interestingly, the study is polls apart from a recent study commissioned by the Economic Advisory Council to the Prime Minister that claimed total employment had risen from 433 million in 2011-2012 to 457 million in 2017-18.
The study said that the agriculture and manufacturing sectors have been worst affected. While the agricultural sector continued to register a fall in the employment rate of 4.5 million per annum, the manufacturing sector has recorded a 3.5 million decline in jobs.
On the other hand, non-manufacturing sectors, that were creating over 4 million jobs till 2011-12 have churned only about 0.6 million per annum between 2011 to 2018.
The high unemployment wave has severely affected the unorganised sector, while daily wage labourers have also been affected due to slow demand. As a result, companies across several sectors cut down on production that caused higher joblessness among individuals in India.