The government has drawn up a plan to boost the system of employment data generation, and dissemination, amid concerns over the official data being less frequent and not exactly in sync with those from independent agencies.
According to official sources, the ministry of statistics is actively considering releasing the Periodic Labour Force Survey (PLFS) for urban areas on a monthly basis, and for rural areas on quarterly basis as it aims to make the data more frequently available to policymakers.
Currently the statistics ministry releases the urban PLFS data on a quarterly basis, and rural one on an annual basis. The National Sample Survey Office (NSSO), the survey arm of the ministry, is working on “predominantly using” technology to conduct the PLFS, which it feels would be crucial in enhancing its frequency.
On Wednesday, Statistics Secretary Saurabh Garg said: “Use of technology is something which we continue to focus on. The purpose of that is to ensure that the time period between surveys can be reduced.”
Lekha Chakraborty, professor, National Institute of Public Finance and Policy (NIPFP) said that the high frequency data on urban labour force participation can strengthen the understanding about relatively less analysed urban face of unemployment and poverty. It would also help the government design social security measures better to cope up the intense poverty they face, she added.
The NSSO had launched the PLFS in FY18. The objective of the survey is to estimate the key employment and unemployment indicators (namely, Worker Population Ratio, Labour Force Participation Rate, Unemployment Rate).
As per the survey, the unemployment rate in rural areas had dropped to 4.3% in 2023, from 5% in 2022; and in urban areas, it fell to 6.7% from 7.6%.
Monthly unemployment data is only provided by the Centre for Monitoring Indian Economy (CMIE), a non-government outfit. Usually, the CMIE and PLFS data differ, due to difference in methodology, but the former’s dataset holds significance to gauge the immediate picture of the joblessness condition in the country.
When it comes to the PLFS, the respondents are asked about their job activity in the past seven days, which reduces the margin of error. However, for the CMIE data, the reference period is just one day. Thus, if an individual is not doing any activity on the day of the survey or a day prior, he/she is termed unemployed.
As reported by FE earlier, the government is also planning to update the base year of the Consumer Price Index to 2024 from 2012 at present, and that of other macro-indicators such as the GDP, IIP and WPI to 2022-23. The new base years are likely to come into effect from 2026.
Former Chief Statistician of India TCA Anant said the government should take the decision of updating the base year on an immediate basis, as the process to make it effective will take at least two years after that.
For the revision of CPI, the government is considering taking the results of the Household Consumption Expenditure Survey (HCES) 2022-23 only, and not 2023-24. The change in the base year would be prospective, and it will not change the extant figures, which are based on 2011-12 base.
Economists have repeatedly pointed to the dire need of updating the base year of key macro indicators, specifically the CPI, as the current figures based on the present base year (2012) don’t necessarily represent the true state of economic activity.
The ministry aims to overhaul the entire statistical system of the country, which includes undertaking additional surveys, fixing data leakages, improving frequency of the survey releases, and tweaking the methodology of computing several macro-economic indicators. It is likely to take a final decision on the revision of the base year of key macro indicators, such as the CPI, WPI, IIP and GDP, by the end of 2024.