As per the Centre of Monitoring Indian Economy (CMIE) Unemployment Rate survey, the unemployment rate for the entire country has declined from 9.2 per cent to 7 per cent, with many states reopening after COVID cases declined. Tamil Nadu’s unemployment rate in July also declined to 4.8 per cent against 8.3 per cent in June as the state opened up more sections of the economy.
But there is a worry as the number of cases has once again started to increase in Tamil Nadu as well as in other states, especially in its neighbouring state, Kerala.
“Chief Minister MK Stalin has warned that if people don’t cooperate, the government may once again go for a lockdown to control the spread of COVID-19. If there is no third wave of COVID-19, the economic growth will pick up and the unemployment rate will further decline,” said a senior official.
In May, Tamil Nadu’s unemployment rate increased to 28 per cent as the lockdown was intense and almost all industries and MSMEs were closed.
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“The construction and textile industries are the ones which are yet to pick up as they have problems with labour. The companies are working towards bringing labourers from Jharkhand, Bihar and West Bengal,” said the official.
Even the overall unemployment rate has dropped for the entire country in July to pre-COVID-19 levels. The CMIE survey showed that the overall unemployment rate in July came down to 7.43 per cent from 10.99 per cent in June. This was lower than March when the overall unemployment rate of the country was 8.75 per cent.
“Between August 2019 and February 2020, overall unemployment hovered between 8.19 per cent and 7.16 per cent,” the CMIE said.
Odisha and Gujarat have the lowest unemployment rate at 1.9 per cent each. Haryana had the highest unemployment rate at 24.5 per cent, followed by Delhi at 20.3 per cent and Himachal Pradesh at 18.7 per cent.
The rural unemployment rate in India also dropped to 6.6 per cent in July as against 10.52 per cent in June. The urban unemployment rate remained higher than national and rural rates. The urban unemployment rate in July was recorded at 9.15 per cent against 12.02 per cent in June. As per CMIE, urban joblessness had touched a high of 25.79 per cent in May and 24.95 per cent in April, making them two of the worst months for job creation.
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The southwest monsoon, which was dull at the start, has picked up and due to this, the agriculture sector is busy with the sowing season in rural areas. Due to this, unemployment in rural areas is less.
“The employment rate was 36.8 per cent in April 2021. The 30-day moving average employment rate on May 23 was 35.8 per cent. This 100-basis point fall in the employment rate translates into a fall in employment of the order of 10 million. This would be much more than the 7.35 million fall in employment recorded in April 2021. Employment has been falling since January 2021. It had fallen by about 10 million between January and April 2021,” said a CMIE official.