India's unemployment increased 2% in FY12 as slowdown hits hiring

Written by fe Bureau | New Delhi | Updated: Jun 21 2013, 22:08pm hrs
Indias unemployment rose by 2% during July 20011-June 2012, almost the same rate as in 2009-10, as the economic slowdown prompted companies to slow hiring to cut cost.

The rise in unemployment rate comes despite 13.9 million new job creation between 2010 and 2012, as the countrys workforce increased to 472.9 million from 459.0 million, data collated by the ministry of statistics and programme implementation showed.

During 2011-12, economic growth slipped to 6.2% from 9.3% in 2010-11, mainly de to industrial slowdown and decline in overseas orders for Indian merchandise. The growth rate further fell to decade's low of 5% in 2012-13. This had prompted many companies to cut jobs or freeze hiring. With thousands of fresh graduates pouring into the job market and job creation almost stagnating, unemployment rate rose. India still fared better than developed nations especially for some debt-ridden European nations where unemployment rate was much higher.

The number of unemployed to labour force ratio increasing to 22 per 1,000 in 2011-12 from 20 in 2009-10 measured in terms of usual status basis. while the urban employment rate rose 3%, it was up 2% in the rural areas. Male unemployment was up 3% and female jobless rate was up by 5% in urban areas while it was nearly 2% for both in rural areas.

The labour force participation rate (LFPR), the ratio of labour force to the population, declined a tad to 39.5% in 2011-12 from 40% in 2009-10, with the LFPR for men almost flat at 55.6% compared with 55.7% earlier while the LFPR for women dropping to 22.5% from 23.3%.

The working population ratio (WPR), the proportion of workforce to population, fell to 38.6% in 2011-12 from 39.2% two years ago as the male WPR nearly dipped to 54.4% from 54.6% while female WPR dipped to 21.9% from 22.8%.

Of the total workforce, the share of self-employed like farmers, traders and businessmen was 52% while regular wage/salaried employees constituted 18% and casual labourers made up for 30%.