Unemployment rate in May looks set to be around 7%, or a shade less

If that happens, the monthly unemployment rate would have stabilised around 7% for six months with a movement within a narrow range of 6.7% to 7.4%

The weekly unemployment rate bounced between 6.9 per cent and 7.7 per cent during May. The simple average of the rate in the past four weeks was 7.3 per cent. And, the 30-day moving average rate was 7 per cent as of May 26, 2019. With just five more days to go before the close of the month, it seems likely that May 2019 would end with an unemployment rate of around 7 per cent, or a shade above 7 per cent.

With this, the monthly unemployment rate would have stabilised around 7 per cent over the past six months with a movement within a narrow range of 6.7 per cent and 7.4 per cent.

Last week, CMIE released its tenth Statistical Profile on Unemployment in India. This 200-page volume can be downloaded for free like all past volumes from unemploymentinindia.cmie.com.

CMIE completed the sixteenth Wave of its Consumer Pyramids Household Survey on April 30, 2019. This included the tenth Wave of its employment and unemployment surveys. The 16th CPHS field work was conducted from January 1 through April 30, 2019. The sample size was 174,405 households across the country and involved 715,273 members, of which 571,954 were of 15 years of age or more.

The survey did face execution challenges during this Wave because of the national elections. While the sample was the largest, the responses were slightly lower (by less than 2 per cent) than during the preceding two surveys. Nevertheless, the overall response rate was 84 per cent.

The Wave-wise estimates of employment/unemployment presented in the Statistical Profiles are the most reliable measures of labour statistics, particularly in comparison with the monthly, weekly or 30-day-moving daily estimates also released by CMIE.

During January-April 2019, there were 29.8 million unemployed people. A person is considered to be unemployed if s/he is willing to work and is actively looking for jobs but cannot find a job.

Another 11.9 million were willing to work if work was available, although they were not actively looking for jobs. This is the potentially unemployed. If we add these to the 29.8 million unemployed, the greater unemployed stock works out to a substantial 41.7 million.

During the same period, 404.3 million persons were employed. The labour force was thus 434.1 million (29.8 + 404.3) and the greater labour force was 445.9 million (29.8 + 11.9 + 404.3).

The unemployment rate works out to 6.87 per cent (29.8/434.1*100) and the greater unemployment rate works out to 9.35 per cent (41.7/445.9*100).

The biggest challenge that India faces is to harness these 42 million people who are willing to work independent of whether they are actively looking for a job or not. Their numbers are growing steadily. A year ago, they were 34.5 million during January-April 2018. Four months ago, they were 39.5 million.

The urban unemployment rate was higher, as usual, at 7.56 per cent during January-April 2019 when compared with rural, which was 6.55 per cent.

The unemployment rate among men was 5.64 per cent, while that among women was much higher at 15.77 per cent. This is in line with the observations in our 9 preceding surveys on labour market conditions in India.

Also in line is the finding that the labour participation rate of women is much lower at 11.02 per cent, compared with 71.54 per cent participation rate of men. Thus, once again, women face the double whammy of low participation rates and, simultaneously, a high unemployment rate.

Urban women are in a particularly poor spot. Only 9.8 per cent of urban women participated in the labour market. This is lower than their rural counterparts, who showed a greater participation rate of 11.6 per cent. But, urban women suffered a much higher unemployment rate of 20.8 per cent, compared with rural women, who faced an unemployment rate of 13.6 per cent.

Of the 404.3 million persons employed during January-April 2019, only 44.6 million were women. Of the 29.8 million persons who were unemployed in spite of actively looking for jobs, 8.3 million were women. So, only 11 per cent of the employed population were women, while 28 per cent of the unemployed were women.

Further, 60 per cent of the unemployed willing to work but not actively looking for jobs were women. There were 11.9 million persons who were unemployed and were willing to work but were not actively looking for jobs. Of these, 7.1 million were women.

This is not the first time that the survey has shown the low labour participation of women in India. It may not be the last, but is there at least some change for the better? We will answer this question on another day.

The author is the MD & CEO of CMIE