India’s Urban Unemployment Rate Declined To 9.8% In July-Sept 2021: Report


New Delhi: As the curbs imposed during the Covid-19 wave were eased and economic activity gathered momentum, the unemployment rate in urban areas in the 15 years and above age group declined to 9.8% in the July- September quarter of 2021.

According to the latest report by the Centre for Monitoring Indian Economy (CMIE), India’s urban unemployment rate declined to 9.8 per cent in July-September 2021 from 12.6 per cent the previous quarter.

The Periodic Labour Force Survey (PLFS) for the September quarter of 2021 also showed that the labour force participation rate (LFPR) improved marginally to 46.9% from 46.8% in the April-June quarter. The LFPR for males also improved to 73.5% from 73.1% in the June quarter.

Data showing a fall in unemployment after the second wave is along the expected lines and mirrors the pattern in 2020 after the economy opened following one of the most draconian lockdowns imposed to contain the spread of the virus.

While the labour force data is released with a significant delay, it is the only official data available on India’s employment situation.

While the urban unemployment rate dropped considerably in the third quarter of 2021, it remained well above the pre-pandemic levels. Worryingly, the large fall in unemployment was accompanied by only a nominal increase in the Labour Force Participation Rate (LFPR), which edged up to 46.9 per cent from 46.8 per cent the previous quarter.

The female unemployment rate was lower after the second wave than immediately before it, standing at 11.6 per cent in July-September 2021 as against 11.8 per cent in January-March 2021. However, the LFPR for females was 130 basis points lower in the later period.

However, the fall in the female unemployment rate in July-September 2021 was helped by fewer women looking for work after the second wave, with the female LFPR falling to 19.9 per cent from 20.1 per cent in April-June 2021.

For males, the LFPR was the same before and after the second wave at 73.5 per cent. However, the unemployment rate was 70 basis points higher.

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