Led by salaried jobs, employment increased by 8.5 million in September to 406.2 million, the highest level since March 2020. However, it still remained slightly lower than the September 2019 level of 406.7 million.
Consequently, unemployment rate fell to 6.86% in September from 8.3% in August this year, but remained slightly higher than 6.68% recorded in September last year, CMIE’s consumer pyramids household survey revealed.
CMIE’s sample comprises over 1.79 lakh households and over 5.22 lakh members who are over 15 years old.
As per the survey, labour force participation rate increased from 40.5% in August to 40.7% in September and, importantly, the employment rate inched up from 37.2% to 37.9% in September this year.
Labour force participation rate is an age-specific proportion between persons either working or actively seeking work and the total population in working age group, usually 15 years and above. Unemployment rate is a ratio between persons who are not currently in job but are actively searching for one and the total labour force.
“The best part of the increase in employment in September 2021 is the increase in salaried jobs. These increased by 6.9 million from 77.1 million in August to 84.1 million in September. Of all the major occupation groups, salaried jobs saw the biggest increase. This big jump in September brings salaried jobs the closest to their average in 2019-20, which was 86.7 million,” CMIE’s MD and CEO Mahesh Vyas wrote in a recent article.
Employment among daily wage workers and small traders also increased by a substantial 5.5 million, from 128.4 million in August to 134 million in September. With this, employment as daily wage labourers or small traders has crossed the pre-pandemic level of 130.5 million in 2019-20.
September 2021, however, saw a fall in employment as entrepreneurs. Their estimated count fell from 76 million in August to 74.4 million in September. The number of farmers also fell from 116 million in August to 113.6 million in September 2021.
“This fall could imply a combination of two factors. First, some salaried jobs that were lost earlier have been revived and some of the labour that migrated to the farms has come back to these salaried jobs. Second, economic activity is likely to have revived to absorb additional people in the form of daily wage labourers,” Vyas wrote.
This is likely to have happened dues to a big increase in employment in the construction industry in October. Employment in this industry shot up by 5.5 million in September.
The service sector surprises with no increase in employment in September. The sector shed over a million jobs in the month.
“India is now at the cusp of the festive season and expectations are that the coming months could boost employment in general and in retail trade in particular. Given the large size of the retail trade industry an increase in employment in this can be expected to have a significant impact on overall employment,” Vyas wrote.