500,000 jobs lost may be just tip of iceberg: Citi

In an indication that the global layoff wave has hit the Indian shores, global financial services major Citigroup believes that jobless numbers in the country could climb in the coming months.

According to a latest report by Citigroup, the country does not appear to have remain unscathed from the massive layoffs witnessed worldwide and unemployment could rise further with home coming of migrant workers.
 
"The pressure on employment, confidence and price levels would be more burdensome than in the past... Moreover, India could be impacted by the return of migrant workers or declining remittances," Citi India economist Rohini Malkani said in the report.

Citi further said that the Ministry of Labour has indicated that over 5,00,000 jobs were lost during October-December 2008, with export-oriented sectors such as gems and jewellery, autos, and textiles being most impacted.

However, the report stated that this statistic only covers the organised sector, which comprises just 10 per cent of the country's workforce of close to 385 million.

The report also said that with elections round the corner, job security could be one of the key election issues.

India's unemployment rate is officially at 8.2 per cent but the point worth noticing is that disguised employment exists in developing economies, it added.

On a sectoral basis, more than half the workforce continues to depend on agriculture, although it accounts for just 18 per cent of the Gross Domestic Products.

"While this has been on the downtrend, it has resulted in widening income gaps," Malkani said.

Depicting the deteriorating economic conditions globally, the latest US jobs data showed more than 5,00,000 job losses for the third straight month resulted in the unemployment rate to rise to 7.6 per cent.

Besides, the International Labour Organisation has predicted that global unemployment could rise in a range of 18-50 million workers.