HAS THE UNEMPLOYMENT RATE DROPPED TO 6.6 % IN RECORDS OR IN REALITY?
(The Quiver): Unemployment rate reached to highest level in past two years due to the pandemic. during the time many people lost their job and were forced to shut down their business ,facing heavy losses . The economic market situation of the country was horrible .Now the unemployment rate is marked to drop from 7.2 percent to 6.6 percent in January 2022.But we would like to inform our readers that the reason behind the dip in employment is not the addition of jobs neither any supporting schemes of the government but the people themselves. Yes, the people of India decided to overcome unemployment rate of the Country as maximum stopped looking for jobs. The number of unemployed people fell by 66 lakhs in January 2022, as they stopped looking for jobs. Consequently, they were no longer counted as unemployed.
According to the Centre for Monitoring Indian Economy, “Employment did not expand to absorb the unemployed in January. On the contrary, employment shrunk by 33 lakhs. The labour force participation rate fell from 40.9 per cent in December 2021 to 39.9 per cent in January 2022. These two ratios show the real stress in the labour markets in January.” This is a perfect example of why the unemployment rate is not a very reliable measure of labour market stress, the CMIE added.
The Reserve Bank of India, too, underlined that labour shortage hampering companies’ productivity. “Sentiments improved over subsequent survey rounds, but companies reported unavailability of raw materials, working capital requirement along with labour shortage as major constraints,” a February 2022 RBI bulletin noted.
Some more experts speculations are taken into consideration to find the actual reasons behind drop in rate of unemployment, which are mentioned below-
A statement given to India Today by Gayathri Vasudevan, Chairperson at LabourNet Services India, “All those who migrated are not willing to come back to the labour market, and many women have post-pandemic decided to not enter/reenter the labour market.”
Many in the gig force are not registered as workers looking for work and, therefore, are seemingly employed part-time , added Vasudevan, who is also a former Project Officer at the International Labour Organization.
Hospitality (42.2 per cent), education (34.8 per cent), telecom (32.2 per cent), and retailing (23.7 per cent) were the sectors that faced a major drop in employment during the pandemic in the same interval, according to CARE Economics Research.
On the other side, information technology (11 per cent), banks (9.3 per cent), healthcare (6.9 per cent), and consumer durables (6.1 per cent) were the sectors that saw an uptick in employment during 2021, compared to the pre-pandemic levels of the year 2019.
The haphazard manner in which daily-wage workers were forced to quit jobs during the first and second waves of the pandemic has instilled fear among the working class. It has also taught them new ways of earning a livelihood. Some also started their own start-ups to earn their living. Now here questions arise what is the role of government in the country if the people have stopped looking for jobs? thus unemployment rate has reduced in records as they are no longer counted as unemployed, how much has the unemployment rate reduced in reality?
