Expansion of farming activity and MGNREGS work have helped cut rural job losses.(HT Photo)
Expansion of farming activity and MGNREGS work have helped cut rural job losses.(HT Photo)

Rural job loss rate at 4-month low

CMIE data showed urban unemployment continues to remain sticky, though it fell 1.3 percentage points in the week to July 12 over the previous week.
Mint, New Delhi | By Prashant K Nanda
UPDATED ON JUL 13, 2020 11:36 PM IST

Amid plentiful rains, increased sowing and the return of workers to cities, unemployment in India’s countryside fell to a four-month low in the week ended July 12, while continuing curbs limited the improvement in towns and cities.

According to latest data from the Centre of Monitoring Indian Economy (CMIE), the rural joblessness rate slowed to 6.34% from the previous week’s 7.78%. The latest figure is lower than that for the week to March 22, immediately before India went into a lockdown. In other words, this is the lowest rural unemployment rate after the week to March 15, when rural joblessness was 6.07%.

On similar lines, the overall unemployment rate, too, came down to 7.44% in the week to July12 from 8.87% in the previous week.

According to Union government data, area sown under kharif crops was 58 million hectares as of last week, 44% higher than a year ago. Focus on the national rural employment guarantee scheme and the return of tens of thousands of migrants to urban areas, too, brightened the rural jobs scene.

“The cooling-off of rural unemployment is due to expanding farming activities, aggressive MGNREGA push in rural India, and the gradual return of migrants to their ex-employers in cities and industrial belts,” said KR Shyam Sundar, a labour economist and professor at XLRI Jamshedpur.

“But one must realise that this improvement in rural employment scenario is institutionalising informality. The job loss in the formal sector, the layoffs that we are witnessing, is leading to self-employment and other odd works, including agricultural work,” he said, adding unemployment in urban India will continue to be stubborn.

CMIE data showed urban unemployment continues to remain sticky, though it fell 1.3 percentage points in the week to July 12 over the previous week. It said urban unemployment rate tapered to 9.92% in the week to July 12 over the week to July 5, which is still much higher than pre-covid-19 weeks.

“The cooling-off of urban joblessness slightly is an outcome of gradual but constant unlocking process, and increase in normal trading activities including at local markets, self-employment avenues, etc. Those who are coming back to previous employers due to demand in the workplace are only representing replacement jobs and not representing new jobs,” Shyam Sundar added.

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