Salaried jobs have been badly impacted by the coronavirus lockdown despite a rise in overall employment rate. Salaried jobs fell to 68.4 million by the end of April due to the lockdown as against 86.1 million in 2019-20. The jobs declined further to 67.2 million by the end of July 2020, according to industry think-tank Centre for Monitoring Indian Economy (CMIE).
As per CMIE's CPHS (Consumer Pyramids Household Survey) estimates, nearly 17 million salaried jobs were lost in the April-June quarter, which is likely to get worse in July.
Meanwhile, informal jobs (non-salaried jobs) have returned and even increased with gradual resumption in economic activity post 'unlocking' of economy. Non-salaried forms of employment have increased from 317.6 million in 2019-20 to 325.6 million in July 2020, registering a growth of 2.5 per cent or nearly 8 million jobs. By the same comparison, salaried jobs fell by 22 per cent or 18.9 million during the lockdown.
Also Read: Hirings pick up 35% between April-June; competition for jobs double: LinkedIn survey
"In terms of percentage change between 2019-20 and July 2020, the fall in salaried jobs is almost uniform across rural and urban regions. The fall was 21.8 per cent in rural India and 22.2 per cent in urban India," said Mahesh Vyas, MD & CEO of CMIE.
Of the 86 million salaried jobs in 2019-20, 58 per cent were in urban India and 42 per cent in rural India. Therefore, the impact of the decline in salaried jobs was higher in urban India compared to rural India.
Also Read: Urban employment rate rises to 35.1% despite lockdowns in major cities: CMIE
As per CMIE report, salaried jobs remained stagnated in India in recent times. In 2017-18, it grew by 1.6 per cent, followed by merely 0.1 per cent rise in 2018-19, before contracting by 1.8 per cent in 2019-20. The figure stood at 86.3 million in 2016-17, which declined to 86.1 million in 2019-20.
Based on analysis of wage bill of 1,560 listed companies, the study finds that employment cost of these companies increased by just 2.9 per cent year-on-year during April-June quarter of 2020, which happens to be the lowest growth in wages recorded in the past 18 years. There was large inter-industry variation with banks recording a 16.6 per cent rise in their wage bill and securities broking companies posting 13.5 per cent growth, but manufacturing companies saw a 7 per cent drop in their wage bill. The services sector had a mixed bag.
Also Read: Govt may relax eligibility norms for availing unemployment benefits soon
The study revealed that the manufacturing sector was the greatest sufferer from employment losses, resulting in lower wage bill. Within manufacturing, textile sector was the worst hit as its wage bill fell by 29 per cent. Textile is a labour-intensive industry and this sharp fall in the wage bill implies a very sharp fall in employment in the industry. In a similar trend, leather, another labour-intensive industry, recorded a 22.5 per cent fall in its wage bill in the June quarter. Automobile ancillaries reported a 21 per cent decline in its wage bill and the automobiles' wage bill was down by 18.6 per cent, CMIE said.
Copyright©2023 Living Media India Limited. For reprint rights: Syndications Today