ILO report, job searches: Employment data grim as FY24 draws to a close

Indian job market has several challenges, says new report by ILO

Several indicators about the employment situation in the country have worsened as the financial year draws to a close.

More people were likely unemployed and there were fewer job listings in February 2024 than the same period last year. The positive was additions to provident fund rolls. The International Labour Organization’s 'India Employment Report 2024' on Tuesday flagged challenges in the job market.

It noted that employment generation is slow because manufacturing, which needs to employ more people, has not grown as strongly as services. Around 90 per cent of workers remain informally employed, said the report.

The unemployment rate reached 8.01 per cent last month compared to the February 2023 figure of 7.45 per cent (chart 1), according to data from the Centre for Monitoring Indian Economy (CMIE).

The rate was higher in urban areas at 8.5 per cent compared to 7.8 per cent in rural India. Female unemployment rate was higher at 13.5 per cent than 7.2 per cent for males in February. In the same month last year, it was 6.7 per cent for males and 14 per cent for females.

The Naukri JobSpeak Index was at 2,780 in February 2024 compared to 3,007 in February 2023. According to Naukri.com, the monthly index represents the state of the Indian job market and hiring activity based on new job listings and job-related searches by recruiters on the resume database of the website. It has improved month-on-month but is lower than the previous year. (chart 2)

 

Data shows that formal employment has improved. Net payroll additions on Employees’ Provident Fund Organisation (EPFO) recorded 1.6 million in January. In the same month last year, it was 1.2 million (chart 3). The EPFO is often regarded as an indicator of people in formal jobs, though questions have been raised over its effectiveness to measure the same.
 

 

One in three young people in the country are not in education, employment, or training, as per the Indian Employment Report 2024 by the International Labour Organisation (ILO).

“Employed youths have been much more likely to be in more vulnerable occupations (informal) or in the informal sector. Youth wages and earnings have increased with age but are lower than what they are for adults in all categories of employment. There has been only a marginal gap between youth earnings from wage employment and self-employment, indicating poor conditions of work,” said the ILO report.

The unemployment rate was 41.77 per cent for those in the age group of 20-24 years and 13.69 per cent for those in the age group of 25-29 years in the last month, according to CMIE data.