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‘Job scenario improved in 2019-20, before pandemic played spoilsport’

According to CMIE, the unemployment rate in January this year was at 6.52%, 6.89% in February, 6.5% in March, 7.97% in April, 11.9% in May and 9.17% in June 2021.

labour survey
The PLFS is based on stratified random samples.

Labour indicators recorded an all-round improvement in 2019-20 compared with the previous two years, data released by the the National Statistical Office (NSO) on Friday showed. According to the third annual report on periodic labour force survey (PLFS), conducted by the NSO between July 2019-June 2020, the unemployment rate fell to 4.8% in 2019-20. In 2018-19, it stood at 5.8% and 6.1% in 2017-18. Unemployment rate is defined as the percentage of persons unemployed among the persons in the labour force.

NSO launched PLFS in April 2017. The first annual report (July 2017-June 2018) was released in May 2019 and the second (July 2018-June 2019) in June 2020. When the results of PLFS 2017-18 was out in 2019, showing unemployment at a 45-year high of 6.1%, a row erupted — while the Opposition cited the date to data to put the government in the dock, the latter said PLFS wasn’t strictly comparable with the with outcomes of the exercise done by NSO previously. The PLFS is based on stratified random samples.

The pandemic hit the country hard since March-April last year. According to the Centre for Monitoring of Indian Economy (CMIE), the monthly jobless rate for March 2020 was 8.75%, which rose to 23.52% in April 2020, then came down a little to 21.73% in May and in June 2020, it was 10.18%. According to CMIE, the unemployment rate in January this year was at 6.52%, 6.89% in February, 6.5% in March, 7.97% in April, 11.9% in May and 9.17% in June 2021.

For the third annual report on PLFS, a little over one lakh households and around 4.2 lakh persons, both in urban and rural areas, were surveyed.

NSO survey

According to PLFS, the worker population rate (WPR), defined as the percentage of employed persons in the population, improved to 38.2% in 2019-20 compared with 35.3% in 2018-19 and 34.7% in 2017-18.

Labour force participation ratio (LFPR) which denotes the percentage of persons in labour force (those working or seeking or available for work) in the population, also increased to 40.1% in 2019-20 from 37.5% and 36.9%, respectively, in the last two years. The higher the LFPR, the better. The data showed the jobless rate for both male and female fell to 5.1% and 4.2%, respectively, in 2019-20 from 6% and 5.2% in 2018-19. WPR and LFPR also comparatively improved during the year.

While the government says the CMIE data doesn’t give true picture of the job scenario due to limitations of the survey, economist Jean Dreze noted that the CMIE’s survey was biased towards better-off households. Given the absence of high-frequency official date, the CMIE data, however, do serve the purpose of gauging the employment scenario in the country.

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