The unemployment rate fell to 21.1 per cent in the week ended April 26, lowest during the coronavirus lockdown period, according to the Centre for Monitoring Indian Economy. The rate of unemployment was 26.2 per cent rate in the preceding week of the month, Mahesh Vyas, Managing Director and CEO, Centre for Monitoring Indian Economy (CMIE), said. While the unemployment rate declined, the labour participation rate further plunged in the period.
"The labour participation rate has dropped from 42.6 per cent in the week of March 22 which was just before the national lockdown to 35.4 per cent in the latest week ended April 26. I.e. a 7.2 percentage point fall, implying that 7.2 per cent of the working age population have quit the labour markets during this lockdown," Mahesh Vyas said in an article.
The labour force is expected to have plunged to 362 million from 434 million in March 2020. Of these, 21.1 per cent were unemployed. "This suggests that the count of the unemployed who were actively looking for jobs during the week of April 26 was of the order of 76 million," he wrote.
"In the earlier weeks, when the unemployment rate was higher at 26 per cent, the count of the unemployed was even higher - possibly close to 100 million," Vyas said. The rural employment rate surged from 27 per cent in the week of April 19 to 29.4 per cent in the week of April 26. In urban areas, the employment rate surged from 24.5 per cent to 25 per cent.
The national lockdown did not just throw 72 million out of the labour force but it also drove another 85 million to some kind of desperation to look for jobs in the midst of a national lockdown when none were available. This desperation suggests that people were highly vulnerable to a loss of livelihood caused by the national lockdown," it added. Lifting of the national lockdown can produce some fast results on the livelihood front, Mahesh Vyas said.
Meanwhile, during the last week of March and in the first two weeks of April, the unemployment rate hovered around 23-24 per cent. In the first week, it was 23.8 per cent, in the second week it dropped a bit to 23.4 per cent but in the third week it bounced back to 24 per cent. India's unemployment rate rose to 26.2 per cent in the third week of April, CMIE data showed.
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