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Farm Crisis | Unemployment
Unemployment

Unemployment

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The Annual Report to the people of India on Employment, Ministry of Labour and Employment, July, 2010, (http://labour.nic.in/Report_to_People.pdf) follows a macro framework for analysing emerging employment and labour market situations during the next 5 to 10 years. The report is based mainly on secondary sources of data. Demographic information is obtained from Census of India and information on labour market is based on the employment and unemployment surveys conducted by National Sample Survey Organisation (NSSO). According to the report:
 

  • Based on the 2004-05 NSSO survey, the estimates of total employment in the country varies from 385 million (as per CDS measure) to 459 million (as per UPSS measure).
  • Overall assessment of employment situation based on UPSS in the country over relatively two longer periods, i.e.,1983 to 1993-94 (Period I-10.5 years) and 1993-94 to 2004-05 (Period II- 11 years) suggests that employment growth in period I was 2.06% per annum as against 1.87% in the period II.
  • The unemployment estimates for 2004-05 varied from 10.8 million (as per usual status - widely referred to as „open unemployment‟) to 35 million (as per daily status which includes both open unemployment and underemployment).
  • Analysis of unemployment data for the year 2004-05 reveals that unemployment rates are very high in urban areas, particularly, in the age group of 15-24 years. Female unemployment rate in the age group of 20-24 years is the highest at approximately 27%. Among males, the highest unemployment rate is reported in the 15-19 years age group both in rural as well as urban areas. However, in the 20-24 years age group, male unemployment rates are 12% and 16% in rural and urban areas respectively. Overall, in rural areas unemployment among youth (age 15-24 years) is approximately 12 to 15%.
  • Based on the employment elasticity with respect to Gross Domestic Product (GDP) observed during the period 1994-2005, the employment for 2009-10 is estimated to be 506 million with an average annual growth rate of 1.97% for the period 2004-05 to 2009-2010. The labour force for 2009-10 is estimated to be 520 million.
  • In India, bulk of the employment (approximately 57%) falls in the category of self employed. Approximately 60% of the rural labour force and 45% of the urban labour force is self-employed.
  • In 2004-05, average casual wage for males and females was just Rs. 55 and Rs. 35 respectively in rural areas and Rs. 75 and Rs. 44 respectively in urban areas.
  • Gender bias in casual wage payment is low in rural areas (0.63) than in urban areas (0.58).
  • About 96% of female employment is in the unorganised sector as against about 91% of males. In urban areas, the percentage of unorganised sector workers is close to 65-70%.
  • Approximately 22% workers were estimated to be below the poverty line in 2004-05. This essentially implies that out of a total of 459.1 million workers (UPSS) in 2004-05 approximately about 102 million were poor.
  • In rural areas, agriculture constitutes up to 68% of the total rural employment. Approximately 81% female workers and 66% male workers in rural areas are engaged in agriculture.
  • Although diversification of the female workforce to non-farm activities in rural areas has been limited up to 2 to 3% since 1993-94, the same in case of male workers has been to the extent of 7 to 8% during the same period.
  • Although over the years, incidence of child labour in the country has declined from around 5% in 1993-94 to approximately 3% in 2004-05, children continue to form a sizeable section of labour force in several fields of employment. Currently, total magnitude of child labour in India is estimated to be approximately 10 million. States like Andhra Pradesh, Uttar Pradesh, Karnataka, Orissa, West Bengal, Madhya Pradesh, Delhi etc. are having relatively higher concentration of child labour.
  • The Census projection report shows that the proportion of population in the working age group (15-59 years) is likely to increase from approximately 58% in 2001 to more than 64% by 2021. In absolute numbers, there will be approximately 63.5 million new entrants to the working age group of 15-59 years between 2011 and 2016. Bulk of this increase in the population is likely to take place in relatively younger age group of 20-35 years. Such a trend would make India as one of the youngest nations in the world.
  • In 2004-05, the estimates of total labour force in the country varied from nearly 420 millions (as per Current Daily Status-CDS) to nearly 470 million (as per Usual Principal and Subsidiary Status-UPSS). The difference between the two estimates essentially arises because the lower estimate of 420 million does not capture those persons who join labour market for short periods of time.
  • Only 25 to 30% women in rural and 15 to 18% in urban areas participate in labour market. One of the reasons of low participation of women in labour force is the non-recognition of a number of women centric works as economic activities (such as cooking, collection of fuel and fodder, house and utensils cleaning etc.). Moreover, variety of social and family related constraints compel women to confine themselves to household activities at their prime working age. Early exit of women (probably post marital age) from labour market is particularly reflected in urban areas where women face inadequate social and family support system.

 


According to the Employment and Unemployment Situation in India 2005-06, National Sample Survey 62nd Round:
 

  • Compared to 1993-94, during 2005-06, unemployment rates in terms of the usual principal status, increased by nearly 1 percentage point, except that for females in urban areas, where they remained virtually unchanged.
  • Between 2004-2005 and 2005-06, work participation rate (WPR) in the usual status approach in rural areas, remained unchanged at 55 per cent for males and it decreased by about 2 percentage points for females, from 33 per cent to 31 per cent. In urban areas, WPR decreased by about 1 percentage point for males and about 3 percentage points for females.
  • Among rural males, the proportion of self-employed had fallen from 61 per cent in 1983 to 57 percent in 2005-06.  On the other hand for females, the proportion remained at the level of 1983 (62 per cent) in 2005-06.
  • Distinct gender differential in usual status WPR was observed: 55 per cent for males and 31 per cent for females in the rural areas, and 54 per cent for males and 14 per cent for females in the urban areas.    
  • The proportion of person-days without work of the usually employed was about 35 per cent and 18 per cent for females in rural and urban India, respectively as against 11 and 5 per cent for males in rural and urban India, respectively
  • In rural India, there has been a gradual increase in the proportion of males engaged in ‘secondary sector (including mining and quarrying)’ – from 10 per cent in 1983 to 17 percent in 2005-06 for males and 7 per cent to 12 per cent for females.
  • Among the persons of age 15 years and above in the rural areas, only 5 per cent got work, 7 per cent sought but did not get work and nearly 88 per cent did not even seek work in public works. For males, nearly 6 per cent got work, 8 per cent sought but did not get work and 85 per cent did not seek work in public works. The corresponding figures for females were, 3, 6 and 91 respectively.  
  • The proportion of persons who got work in public works decreased with the increase in the MPCE (monthly per capita expenditure) for both males and females. The proportion in the top MPCE class (Rs. 690 and above) for males was only about one-fifth of that in the bottom MPCE class (less than Rs. 320) – nearly 9 per cent in the bottom MPCE class and nearly 2 per cent in the top MPCE class. For females this ratio was about one-fourth – nearly 4 per cent in the bottom MPCE class and nearly 1 per cent in the top MPCE class. 
  • The average number of days worked in public works, during the last 365 days, by males and females was almost the same- 17 for males and 18 for females. The maximum number of days worked, for males, was in the top MPCE class (Rs. 690 and above) – 24 days during the last 365 days. For females maximum number of days worked was in the MPCE class (Rs. 510 – Rs. 690) -  23 days during the last 365 days.


 

According to Women in labour markets: Measuring progress and identifying challenges, March 2010, International Labour Office, Geneva,
http://www.ilo.org/wcmsp5/groups/public/---ed_emp/---emp_e
lm/---trends/documents/publication/wcms_123835.pdf:

Labour utilization

  • The overall picture of the global capacity to tap the productive potential of its people is one in which nearly half (48.4 per cent) of the productive potential of the female population remains unutilized (compared to 22.3 per cent for men).
  • Between 1980 and 2008, the rate of female labour force participation rate (LFPR) increased from 50.2 to 51.7 per cent while the male rate decreased slightly from 82.0 to 77.7 per cent. As a result, the gender gap in labour force participation rates has narrowed slightly from 32 to 26 percentage points.
  • Of all people employed in the world, 40 per cent are women. This share has not changed over the last ten years.
  • The share of women above the working age (15 years and over in most countries) who are employed (the employment-to-population ratio) was 48.0 per cent in 2009 compared to a male employment-to-population ratio (EPR) of 72.8 per cent.
  • In absolute numbers, worldwide there were equal numbers of women and men above the age of 15 years in 2009 (2.5 billion of each), but among these only 1.2 billion women were employed as opposed to 1.8 billion men.
  • More than six in ten women remain economically inactive in three regions: South Asia, the Middle East and North Africa.


Labour underutilization

Overall, there is not a significant difference between the sexes when it comes to global unemployment rates but the female rate is consistently slightly higher than the male. The female unemployment rate in 2009 was 7.0 per cent compared to the male rate of 6.3 percent. Also at the country level, the majority of countries have higher unemployment rates for females than males (113 countries out of 152) and 30 countries showed female rates that exceeded male rates by more than 5 percentage points.


Female employment: Where and how women work

  • The share of women in wage and salaried work grew during the last ten years from 42.8 per cent in 1999 to 47.3 per cent in 2009 whereas the share of vulnerable employment decreased from 55.9 to 51.2 per cent.
  • The shares of persons working in vulnerable employment are high for both sexes, especially in the world’s poorest regions, but still higher for women than for men (51.2 per cent for women and 48.2 per cent for men in 2009).
  • Out of the total number of employed women in 2008, 37.1 per cent worked in agriculture and 46.9 per cent in services. Male sectoral shares in comparison were 33.1 per cent in agriculture and 40.4 per cent in services.


The current economic crisis

  • The global female unemployment rate increased from 6.0 per cent in 2007 to 7.0 per cent in 2009, slightly more than the male rate which rose from 5.5 to 6.3 per cent. However, in four of nine regions – Developed Economies & European Union, Central & South-Eastern Europe (non-EU) & CIS, East Asia and South-East Asia & the Pacific – the male unemployment rates increased slightly more than the female rates over the same period.
  • Female unemployment rate increased from 14.4 to 15.0 per cent between 2007 and 2009 while the male rate remained constant at 7.7 per cent.


According to the Global Employment Trends by International Labour Organization (ILO), January 2010,

http://www.ilo.org/wcmsp5/groups/public/---ed_emp/---emp_e
lm/---trends/documents/publication/wcms_120471.pdf:  

  • The Developed Economies and European Union, Central and South-Eastern Europe (non-EU) & CIS, and Latin America and the Caribbean are estimated to have had negative growth rates in 2009, with the fall in annual growth rates between 2008 and 2009 exceptionally large in Central and South-Eastern Europe (non-EU) & CIS, at 11.0 percentage points. Only in East Asia and South Asia economic growth rates are estimated to have been 5 per cent or more in 2009. In 2007, all regions outside the Developed Economies and European Union recorded growth rates exceeding 5 per cent.
  • On the basis of currently available labour market information and the most recent revisions in GDP growth, the global unemployment rate for 2009 is estimated at 6.6 per cent, with a confidence interval (CI) from 6.3 to 6.9 per cent.
  • The number of unemployed persons is estimated at 212 million in 2009, with a CI from 202 to 221 million. Based on the point estimate (212 million), this means an increase of almost 34 million over the number of unemployed in 2007, and most of this increase occurred in 2009.
  • The global employment-to-population rate (point estimate) dropped from 60.9 per cent in 2008 to 60.4 per cent in 2009, with a CI from 60.2 to 60.6 per cent.
  • The largest change in employment-topopulation rates occurred in the Developed Economies and the European Union (decrease by 1.8 percentage points), in Central and South-Eastern Europe (non-EU) & CIS (minus 1.4 percentage points), and in Latin America and the Caribbean (minus 0.9 points), with more limited decreases in other regions.
  • The global employment growth rate was 0.7 per cent in 2009, less than half the growth rate of the working-age population of 1.5 per cent.
  • Growth in output per worker are negative in all regions except East Asia, South Asia and North Africa. The largest fall in output per worker occurred in Central and South-Eastern Europe (non- EU) & CIS, minus 4.7 per cent (with a CI between -4.9 and -4.3 per cent), thus reversing part of the gains that were made in the first half of the decade.
  • Between 2008 and 2009, the unemployment rate for women increased by 0.8 percentage points and for men by 0.7 percentage points. This means that the gap in unemployment rates by sex increased slightly to 0.6 percentage points between 2008 and 2009, which is the same gap as ten years ago.
  • On current estimates, the global youth unemployment rate rose by 1.3 percentage points from 12.1 per cent in 2008 to 13.4 per cent in 2009 (with a CI between 12.7 and 14.0 per cent).
  • Globally, youth labour force participation rate decreased by 3.4 percentage points between 1999 and 2009.
  • The largest potential negative impact is in South Asia, South-East Asia and Sub-Saharan Africa, where extreme working poverty may have increased by 9 percentage points or more in the worst case scenario. These estimates reflect that the fact that preceding the crisis, many workers were only just above the poverty line in these regions.
  • The regional unemployment rate in South Asia is estimated to have increased to 5.1 per cent in 2009, up from 4.8 per cent in 2008, but little changed from the rates registered between 2004 and 2007. Women face higher unemployment rates in the region, with a rate of 5.9 per cent in 2009 as compared with the male rate of 4.8 per cent. This is despite the fact that women participate to a much lesser extent in the labour market than men.
  • The South Asia region’s youth unemployment rate is estimated at 10.7 per cent in 2009, up from 9.9 per cent in both 2008 and 2007.
  • South Asia’s unemployment rate is projected to decline slightly to 4.9 per cent in 2010, with a confidence interval of 4.6-5.3 per cent, as GDP growth is expected to edge higher to 6 per cent.
  • While there has been much progress in extending social protection in the region through initiatives such as India’s National Rural Employment Guarantee Act (NREGA), which has provided a significant buffer during the crisis, helping to maintain levels of consumption, poverty and vulnerable forms of employment remain widespread and represent tremendous challenges that must be overcome.

Rural Expert
 

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