Joblessness as measured by the CMIE All India unemployment rate remained elevated in February 2023 and rose to 7.45% from 7.14% in the previous month.
Urban unemployment rate decreased for the second straight month and was at 7.93% in February as against 8.55% in January. It had touched a record high of 10.09% in December 2022.
But more worrying the rural unemployment rate spiked to 7.23% last month from 6.48% in January.
Mahesh Vyas, Managing Director and CEO, Centre for Monitoring Indian Economy however, said that it is important to note that the labour participation has increased at the same time from 39.8% to 39.92%. “The employment rate, which is the most important indicator has dropped a bit from 36.96% to 36.94%,” he told FE.
The data comes soon after the Periodic Labour Force Survey revealed that unemployment rate declined to 7.2% in the October – December 2022 for persons aged 15 years and above in urban areas as against 8.7% in the same period in 2021.
However, other data indicates a more cautious picture on unemployment, at least in the formal sector. The number of first-time members joining the Employees’ Provident Fund Organisation (EPFO) declined by 14.5% on a sequential basis to 0.8 million in December 2022 from 0.93 million members in November 2022. Previously, a report by the Indian Staffing Federation had revealed that new flexi staffing jobs grew at its slowest pace in 10 quarters by 0.8% on a sequential basis in the quarter ended December 2022.
NREGA data shows that the demand for work in February 2023 increased and was at its highest level since June 2022. Over 26.3 million persons demanded work under the scheme in February 2023 as against 25.9 million in January this year.