Unemployment rate rises to six-week high of 8.1%

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August 10, 2021 1:00 AM

Unemployment rate, defined as the percentage of unemployed persons in the labour force, was 7.3% for the week ended July 4. It rose to 7.64% the next week before falling to 5.98% for the week ended July 18. It went up again to 7.14% for the week ended July 25 and further to 7.44% in the week ended August 1.

The LFPR 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.The LFPR 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.

The country’s unemployment rate rose to a six-week high of 8.1% in the week ended August 8, according to data compiled by the Centre for Monitoring of Indian Economy (CMIE).

Unemployment rate, defined as the percentage of unemployed persons in the labour force, was 7.3% for the week ended July 4. It rose to 7.64% the next week before falling to 5.98% for the week ended July 18. It went up again to 7.14% for the week ended July 25 and further to 7.44% in the week ended August 1.

CMIE data showed unemployment in both urban and rural areas was on the rise for three weeks till the latest week reviewed. The consistent rise in the overall unemployment rate since July 18 shows the economy’s inability to create jobs even as lockdowns and restrictions on mobility have largely been eased.

The rise in unemployment rate could also be on the back of an increase in the labour force participation rate (LFPR) and if that is so, it should not be much of a worry, CMIE’s MD and CEO Mahesh Vyas had told FE earlier.

Joblessness in cities grew by a sharp 202 basis points to 9.96% in the week ended August 8 from 7.94% for the week ended July 18. Urban unemployment rate was 8.03% for the week ended August 1.

Similarly, the joblessness rate in rural areas saw a sharp 217 basis points increase to 7.27% for the week ended August 8 from 5.1% in the week ended July 18. It was 7.18% in the last week.

Overall unemployment rate significantly increased since the beginning of the second Covid-19 wave to a near one-year high of 14.73% for the week ended May 23 as against 8.16% on April 4.

The LFPR 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.

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