Due to the second wave of Corona, more than 1 crore Indians lost their jobs in the country and the income of more than 97% of the families has decreased. Mahesh Vyas, CEO of the private think tank Center for Monitoring Indian Economy (CMIE), has said this. He says that by the end of May, the country’s unemployment rate could come down to 12%. The unemployment rate in April was 8%.
The unemployment rate reached a record 23.5% in May due to the nationwide lockdown last year. Many experts are of the opinion that the peak of the second wave of infection has gone. States will now gradually lift restrictions on economic activity. This will help the economy.
side effects of corona on employment
- Those who have lost their jobs, they will hardly get employment again.
- Jobs in the unorganized sector will soon be available, but it will take up to a year to create quality jobs and employment opportunities in the organized sector.
- The economy is starting to open up. This will solve the problem of unemployment a little, but the problem will not end completely.
- At present, the labor participation rate in the market has come down to 40%. The labor participation rate before the epidemic was 42.5%.
Unemployment rate of 3-4% normal for Indian economy
Vyas said that the unemployment rate of 3-4% is normal for our economy. The unemployment rate will decrease further. CMIE conducted a nationwide survey on 1.75 lakh families in April. The disturbing trend of earnings in the past year was revealed in this service. In the survey, only 3% of the households said that their income had increased, while 55% said that their income had fallen. The remaining 42% said that there was no change in their income. If it is calculated in terms of inflation, then the income of 97% of the households has decreased.
Urban unemployment rate approaches 18%
According to the latest CMIE data, the unemployment rate in the urban area has reached close to 18% in the week ended 30 May. According to the data, the unemployment rate in the urban area has been 17.88%. While the unemployment rate at the national level during this period has been 12.15%. According to the data, the urban unemployment rate has increased by 3% in the last 15 days. While the urban unemployment rate stood at 10.8% in the week ending May 2.
Unemployment rate decreased by 4% in rural area
According to data from CMIE, in the week ended May 30, the unemployment rate in rural areas fell to 9.58%. There has been a decline of 4% in the unemployment rate in rural areas as compared to 15 days ago. The labor force participation rate in urban areas stood at 35.69% for the week ended May 30. Whereas in the week ending May 16, the labor participation rate in the urban area was 37%.
Unemployment rate will remain high in urban area for 6 months
Labor economist KR Shyam Sundar says that the unemployment rate in urban areas will remain high for 3 to 6 months. There are three major reasons for this.
- First reason: less employment opportunities.
- The second reason: the hesitation of companies to hire more employees.
- The third reason: increased exposure to labor due to scientists’ study of coronavirus spread through the air.
Limited employment opportunities in sectors other than IT
KR Shyam Sundar says that there are limited employment opportunities in all places except IT and its related sectors. If we look at the unorganized sector, hospitality and tourism sector including FMCG, retail trade, automobile, urban markets, then there is nothing to be happy about. Business sentiment is down. There is a decline in consumption. We are facing a cyclical or circular crisis.
Corona epidemic statistics in the country
- Total new cases came in last 24 hours: 1.26 lakh
- Total cured in last 24 hours: 2.54 lakh
- Total deaths in last 24 hours: 2,781
- Total infected so far: 2.81 crore
- So far cured: 2.59 crores
- Total deaths so far: 3.31 lakh
- Total number of patients currently undergoing treatment: 18.90 Lakh