Employment rate halts recovery, falls again in October

Deccan Chronicle.  | Sangeetha G

Business, Economy

The first three weeks of October show signs of continued stress.

Fall in the employment rate revealed in the first three weeks of October 2020 (Representative image)

Chennai: After recording a month-on-month recovery till September from the lows of April, the employment rate has once again dropped in the first three weeks of October. The significant drop in MGNREGA mandays has pulled down rural jobs and stagnated the overall employment rate.

The employment rate of 2019-20 stood at 39.4 per cent. It fell to 27.2 per cent in April 2020 but recovered to 30.2 per cent in May. In June, it further recovered to 36.2 per cent and then to 37.6 per cent in July. There was a marginal drop in August to 37.5 per cent, but September once gain saw a recovery to 38 per cent.

However, the first three weeks of October show signs of continued stress. The employment rates of the first three weeks were 37.6 per cent, 37.5 per cent and 37.9 per cent, as per CMIE’s Consumer Pyramids Household Survey.

Fall of the employment rate revealed in the first three weeks of October 2020 is entirely because of a fall in the employment rate in rural India. The weekly employment rate had touched 39.9 per cent in the week ended September 6. But, in the week ended October 4, the rate was down to 39 per cent and then it slipped further to 38.8 per cent in the week ended October 11. It recovered to 39.5 per cent in the week ended October 18, but was still lower than the September average.

Despite October being the peak season for harvesting Kharif crop, the rural employment rate has fallen.

“It is possible that employment under the MGNREGA has declined significantly in October. Till October 19 this year, the scheme had provided 58.5 million person-days of employment compared to 138 million person-days of employment provided during the entire month of October 2019,” finds CMIE. The average person-days of employment per day in October 2019 was 4.47 million. In the first 19 days of October 2020 it was 3.08 million, a fall of 31 per cent.

Meanwhile, the employment rate in urban India, which stood at 34.4 per cent in September, improved in the first three weeks of October to 34.8 per cent.

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