Little Cheer: Jobs growth weak over past decade, finds survey

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September 28, 2021 4:30 AM

Just 3.3% annual rise in employment in 8 years to FY22, show govt data

Jobs growthAs per the latest data from the Centre for Monitoring Indian Economy (CMIE), jobs increased by 8.5 million during September led by an increase in salaried jobs.

The country’s employment growth in the organised non-farm sector trailed the rate of economic expansion by a considerable margin in the eight years to FY22, with just 3.3% annual increase in jobs in the sector, according to a fresh series of government data released on Monday. The report of Quarterly Employment Survey (QES) unveiled by the Union labour ministry also showed a decline in participation of female workers in the organised sector.

Employment in establishments with 10 or more employees in nine selected sectors, including construction, manufacturing and IT/BPO, was at 3.08 crore in the April-June quarter of 2021-22, up 29% compared with 2.37 crore reported in the sixth Economic Census (EC-6) of 2013-14, according to the survey.

Female workers in such organised sector employment were 29% in April-June 2021, lower than 31% recorded in EC-6.

The first all-India quarterly establishment-based employment survey (AQEES) for the April-June quarter of the current fiscal, conducted by the Labour Bureau, a unit under the labour ministry, also found that nearly one in five among the 3 crore employees in the nine sectors received reduced or no wages during the lockdown period (March 26 to June 30) in 2020.

Labour experts, however, felt these figures could be underestimates, being not in sync with other data such as the frequent household surveys conducted by the Centre for Monitoring Indian Economy (CMIE), which showed a grimmer picture of the employment scenario in the larger non-farm sector, and its exacerbation due to the pandemic-induced lock-downs.

The QES is part of the All-India Quarterly Establishment-based Employment Survey (AQEES); it will also include an informal sector survey being done by the Labour Bureau. The first round of QES had a reference date of April 1, 2021.

Of the total employment estimated in the selected nine sectors in the organised industry, manufacturing accounted for nearly 41% followed by education with 22%, and health, 8%. Trade as well as and IT/BPO each engaged 7% of the total estimated number of workers.

According to the survey, conducted among 12,000 units, an impressive growth of 152% was recorded (between 2013-14 and Q1FY22) in the IT/BPO sector, while growth rates were 77% in health, 39% in education, 22% in manufacturing, 68% in transport and 42% in construction. However, employment in trade came down by 25% and in accommodation & restaurant, by 13%. Financial services saw a 48% growth in employment. Nearly 90% of the establishments have been estimated to work with less than 100 workers, the corresponding figure during EC-6 being 95%.

Nearly 35% of the IT/BPO establishments worked with at least 100 workers, including about 13.8% engaging 500 workers or more. In the health sector, 18% of the establishments had 100 or more workers.

Labour expert KR Shyam Sundar said: “It is unbelievable that during the almost full-scale lockdown period in 2020, 81% of the workers received full wages. Given this and the other statistics, this (QES findings) may be treated as employers’ claims rather than credible statistical data.”

The CMIE survey had found: “Of the 403.5 million jobs in 2019-20 only 282.2 million survived the world’s most severe lock-own. But, the recovery was swift. In May 2020, 31.5 million jobs came back, in June 2020 another 63.2 million repaired were restored and in July 2020, 15.3 million more returned. By July of 2020, the loss of jobs had narrowed down to 11.1 million.”

According to the annual report (2019-20) of the Periodic Labour Force Survey (PLFS) released in early August, in the 12 months between July 2019 and June 2020, the unemployment rate in the country — as gauged by the method of ‘current weekly status’ – was close to a five-decade high of nearly 9%. However, going by the ‘usual status’ (unemployment over the past year) method, the country’s unemployment rate fell from 6.1% in 2017-18 to 5.8% in 2018-19 and further to 4.8% in 2019-20, with a matching increase in the labour participation rate. This was found puzzling by many analysts, given the sharp decline in economic growth rate during the period and the fact that the strict lock-down period during the first Covid wave was also part of the survey period.

Earlier this month, as the National Statistical Office (NSO) in its quarterly urban-PLFS said that unemployment rate for all ages in urban areas rose to 10.3% in October-December 2020 against 7.9% a year ago; the rate was 13.3% in July-September 2020.

Labour market has registered a swift recovery after the draconian lockdown of April 2020, but the recovery has been partial and exhausting, Mahesh Vyas, MD & CEO, CMIE wrote in a recent article. Even as unemployment rate has recovered – it was 7.6% in 2019-20 and in July-August 2021 it averaged at 7.6%, down from 23.5% in April 2020 – but may have settled at a high rate of 7-8%, Vyas noted.

Of course, the CMIE data, the most frequent one on the employment scenario in the country, are based on information gathered from individuals who are members of a panel of households included in CMIE’s quarterly Consumer Pyramid survey.

While PLFS provides household-based employment scenario for the supply side of labour market, AQEES provides demand-side estimate of gender-wise and the nature of employment, vacancies, training and other related parameters for the major nine sectors of the economy. The government will soon field work for a similar survey for establishments, including those in the unorganised sector, employing less than 10 people.

Announcing the QES results, labour and employment minister Bhupender Yadav said the new tool will contribute to “evidence-based policy-making and statistics-based execution”. “Such scientifically collected data with integrity that can be cross-examined will be immensely beneficial towards achieving targeted and last- mile delivery of government programmes and schemes,” he said.

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