India’s Unemployment Rate At 6.1% In 2017-18
Workers cross a road outside a Tata Steel Ltd. plant in Jamshedpur, Jharkhand, India (Photographer: Anindito Mukherjee/Bloomberg)  

India’s Unemployment Rate At 6.1% In 2017-18

Unemployment rate in India, across urban and rural areas, stood at 6.1 percent between July 2017 and June 2018, according to the first Periodic Labour Force Survey of the National Sample Survey Office.

According to the annual report released today:

  • Unemployment rate for females, rural and urban, stood at 5.7 percent.
  • For males, rural and urban, the unemployment rate stood at 6.2 percent.
India’s Unemployment Rate At 6.1% In 2017-18

Given the lack of frequent and standardised data on the size of the labour force, participation and unemployment this survey data is tough to contextualise. The last such data was collected for July 2011 - June 2012 in the Employment and Unemployment Survey. Since the methodologies differ, the two data sets may not be strictly comparable, as emphasised by the Chief Statistician of India Pravin Srivastava, but offer some reference.

For instance, the all India unemployment rate was 2.7 percent in the 2011-12 period. That suggests a big jump in unemployment in six years, especially in urban areas.

UNEMPLOYMENT RATE: July 2017- June 18 (vs July 2011 – June 2012)

  • All India: 6.1% (vs 2.7%)
  • Rural Males: 5.8% ( vs 1.7%)
  • Rural Females: 3.8% ( vs 1.7%)
  • Urban Males: 7.1% ( vs 3%)
  • Urban Females: 10.8% ( vs 5.2%)

The overall rate, as well as rural male and female unemployment as well urban male employment, are the highest since the 70s - when employment and unemployment was first surveyed.

Periodic Labour Force Survey Report
Periodic Labour Force Survey Report

Creating jobs will be the focal point for the Modi government which has been elected for a second term with an even bigger mandate. The unemployment issue has long plagued India. Over 70 percent of Indians surveyed have said that the lack of employment opportunities is the most pressing concern for them, according to a Pew Research Center report released March. Four out of five people said that job opportunities have gotten worse in the last five years.

Almost 67 percent of India's population is of working age—between 15 and 64—according to the United Nations. Without adequate job creation India will find it hard to maintain its world beating economic growth. "The macro challenge is clearly to generate jobs given the demographic," Chris Wood, Global head of equity Strategy, Jefferies said in a note recently.

The government will have to focus on policies supporting the manufacturing sector to speed up job creation as they have huge potential, rating and research agency Crisil said in a prior note. “Such sectors would include textiles, leathers, gems and jewellery and construction,” it said. The report added that preparing youth by skilling them to adapt to newer jobs due to rapidly changing technology will also be key.

The release of the PLFS annual report has been delayed by the government. When Business Standard newspaper viewed a draft version and reported on the unemployment rate being at a 45-year high, Niti Aayog Vice Chairman Rajiv Kumar had countered that the report was not finalised. With the Lok Sabha elections done the report has finally been released.

Also read: Is Fiscal Expansion The Answer To India’s Job Crisis?

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