The spike in the unemployment rate shows that a growing number of job seekers were left disappointed as they could not find jobs and their addition to the labour force merely raised the unemployment rate.
The migrant workforce, which returned to the hometowns in haste amid the coronavirus lockdown, has gradually started to come back into the market in search of jobs. The increasing number of workers looking for jobs has raised the labour participation rate, but unavailability of sufficient work for them has shot up the unemployment rate in the country. The unemployment rate rose to the highest level of 27.1 per cent in the week ended May 3, according to the Centre for Monitoring Indian Economy (CMIE). The labour participation rate (LPR) rose from 35.4 per cent in the week of April 21 to 36.2 per cent in the week ended May 3.
The spike in the unemployment rate shows that a growing number of job seekers were left disappointed as they could not find jobs. Their addition to the labour force merely raised the unemployment rate, said CMIE. The data has suggested that one out of every four people who are willing to work do not have a job to do and the surge in LPR amid lockdown shows hope and desperation among workers.
Small traders and wage labourers seem to be among the worst hit from the lockdown. Employment among these dropped from an average of 12.8 crore in last fiscal to a mere 3.7 crore in April, which means that more than 9 crore people lost their livelihood in just about a month. This category includes hawkers and daily wage-earning labourers whose livelihood depends everyday on a functioning economy.
Meanwhile, the lack of work opportunities and weak financial conditions of the workers may make the job environment more haphazard in the near-term. In a post lockdown world, there are going to be work deficit zones and work surplus regions and in the work surplus areas, the situation will be grim as there is going to be an abundance of returning workers with relatively higher skills, and thus the exploitation could commence, Gayathri Vasudevan, Executive Chairperson and Co-Founder, LabourNet Services, had told Financial Express Online.