It is almost December, 2011, and we are yet to see the ministry of labour and employment come out with the national unemployment rate for 2010-2011. The country sincerely hopes that the Report on Employment and Unemployment Survey (2009-2010), published in October 2010, was not a one-off thing.
Studies based on statistics collected at the ground level have been invaluable to ascertain successes and failures of various schemes and programmes. In that light, it may come as a shock to know that till 2010, the ministry of labour and employment of India had not done a single comprehensive nationwide study to ascertain the magnitude of the country’s unemployment situation.
The National Sample Survey Organisation (NSSO) does a Census kind of study on unemployment every five years. But when every major country in the world conducts this survey once every year, and at times four times a year, the NSSO study was not the correct indicator of the unemployment problem as the pattern changes on a monthly and at times on a weekly basis. In the United States, the Bureau of Labour Statistics releases monthly figures of unemployment.
The unemployment rate for 2009-2010 was based on the bureau's study and not the NSSO study. The report stated that 40 million people were unemployed at the end of 2010 and the rate was 9.4 per cent.
Conducted in 28 states and Union Territories which account for nearly 99 per cent of India's population, the study estimated that 63.5 per cent of the nation's 1.182 billion people fell in the working age group of 15-59 years. In this regard, it would be worthwhile to mention that unemployment rate does not correspond to the total population of a country.
At a Labour Force Participation Rate (LFPR) of 359 per 1000, there were 425 million people in India who were employable at the end of 2010 ie people who are working or are willing to work. This may surprise a few people but it is a socio-economic fact that most people in the working age group are not interested in working. Women constitute the bulk of this number in a country where women's rights are still quite far from permeating into the social mainstream.
The situation can be gauged from the fact that even amongst the people willing to work, the unemployment rate was 8 per cent for men whereas for women, the unemployment rate was as high as 14.6 per cent.
Under the survey, 45859 household schedules were canvassed, of which 24,653 were rural and 21,206 urban household schedules. A total of 2,33,410 persons were interviewed to gather information from the 45859 households.
The report estimated the total number of households at 238 million, of which 172 million (872 million people) were rural and 66 million (310 million people) urban. The rural unemployment rate was 10.1 per cent where as in urban areas, the unemployment rate stood at 7.3 per cent.
Within the employed population, self employment was the dominant category. Out of 1000 persons employed, 439 persons were self employed, 168 persons were regular wage/salaried and the rest 393 persons were employed as casual labour at the overall level.
The survey results revealed that 455 persons out of 1000 persons employed were employed in agriculture, forestry and fisheries group at the overall level, followed by 89 persons in the manufacturing group, 88 persons in the wholesale & retail trade, 84 persons in the community services group and 75 in the construction group of industries.
The survey results indicated that out of 1000 persons, 157 persons were either getting or were eligible for paid leave in the establishment in which they were employed at the overall level.
In case of other social security benefits such as the provident fund, gratuity, health care and maternity benefits, pension etc, 163 persons out of 1000 persons reported the provision of any one of the above benefits in the unit, in which they were employed at the overall level.
The study has cope for improvement. It categorically stated that compared to the NSSO survey, the unemployment rate was quite high probably due to underestimation of employment in the agriculture sector.
In the agriculture sector as well as fishery or raising of livestock, women and teenagers are often engaged casually, thus complicating the matter.
In spite of its limitations, this is a good start. Annual or bi-annual unemployment figures are invaluable not only for the government in planning and deciding on sectoral allotment, they also arm industry and investors with useful information upon which they can base their decisions.
It also reflects if GDP growth is creating jobs or if the current trajectory is just leading to jobless growth.
The 2011 labour report is already due. Let's hope for better numbers if and when it comes out.
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