Status of Unemployment in India
- Centre for Monitoring Indian Economy: Unemployment rate saw an increase from 7.4 per cent in March 2024 to 8.1 per cent in April 2024.
- NSSO Data: According to Periodic Labor Force Survey (PLFS) for Calendar Year 2023 released by National Sample Survey Office (NSSO), unemployment rate was 3.1% for calendar year 2023 (in contrast to global unemployment rate of 5.1% in 2023).
- Urban unemployment rate (5.2%) for calendar year 2023 was higher than rural unemployment rate (2.4%).
- According to PLFS for Calendar Year 2023 women’s labor force participation rate was 41%.
- World Bank Report: In the “South Asia Development Update Jobs for Resilience” report, highlighted below average employment ratios for women in India.
- International Labor Organization (ILO) report: The “India Employment Report 2024” revealed that one out of every three unemployed individuals was young.
Reasons behind Unemployment in India
- Higher population Growth: World Bank has warned that South Asia region including India was not making use of its demographic dividend.
- Illiteracy: According to the ILO report, despite the considerable progress, the level of educational attainments at higher levels remains low and quality is a concern. This acts as a challenge to employment.
- Skill gap & Challenges in Skill Development: Only about 4.7% of Indian labor force has undergone any formal skill training.
- Impact of automation and technology on job market: Manufacturing is becoming more capital-intensive and automated, which provides growth but doesn’t provide mass employment.
- Seasonal nature of employment in certain industries: About 45.76% of the total workforce is engaged in agriculture (Seasonal employment) and allied sector during 2022-23.
- Casual and informal labor: Due to a scarcity of jobs, individuals often resort to informal sector employment, characterized by low and inconsistent wages.
Steps Taken towards employment generation
- Aatmanirbhar Bharat Rojgar Yojana (ABRY): It has been launched as part of Atmanirbhar Bharat package 3.0 to incentivize employers for creation of new employment along with social security benefits.
- Pradhan Mantri Mudra Yojana (PMMY): Provides collateral free loans upto Rs. 10 lakh to micro/small business enterprises and individuals to enable them to setup or expand their business activities.
- Prime Minister Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi Scheme): To facilitate collateral free working capital loan to street vendors to restart their businesses, which were adversely impacted during the Covid-19 pandemic.
- PM Vishwakarma Scheme: To provide end-to-end support to artisans and crafts people of rural and urban areas across the country. The Scheme aims to strengthen and nurture Guru-Shishya parampara.
- National Education Policy 2.0: It integrates vocational education into mainstream education and proposes that all students receive vocational education from Class 9 onwards. It aims to increase the employability of future generations by emphasizing skill development.
- Deen Dayal Antyodaya Yojana-National Rural Livelihoods Mission (DAY-NRLM): A scheme under the Ministry of Rural Development that organizes rural poor women into Self Help Groups.
- Pradhan Mantri Kaushal Vikas Yojana: Launched by Ministry of Skill Development and Entrepreneurship (MSDE) and implemented by National Skill Development Corporation (NSDC), this Skill Certification scheme enables the youth to take up industry relevant skill training.
- Others: Make in India, Start-up India, Stand-up India, Digital India, Smart City Mission, Rozgar Melas, etc.
Four key employment and unemployment indicators:
- Labor Force Participation Rate (LFPR): Defined as the percentage of persons in the labor force (i.e., working or seeking or available for work) in the population.
- Worker Population Ratio (WPR): Described as the percentage of employed persons in the population.
- Activity Status – Usual Status: The activity status is determined based on the reference period of the last 365 days preceding the date of survey.
- Activity Status – Current Weekly Status (CWS): Determined on the basis of a reference period of last 7 days preceding the date of survey.