Working Towards Recovery

Context: Key results of various employment surveys point towards employment recovery but ground reality seems to be different.

India’s employment challenges post-COVID -19

• Vulnerable indicators in employment sector:
  • Delhi Metropolitan Area Survey (DMAS) indicates a sharp drop in seasonally adjusted employment immediately following the first lockdown in April-June 2020.
  • Employment rate for men aged 21-59 fell from pre pandemic high of 88% to 63% in April-June 2020.
  • Women’s employment rates declined from 33% to 23%.
  • Periodic Labour Force Survey (PLFS) has also shown a sharp decline in worker population ratio for men aged 15 and above from 67% to 57%, and for women from 19.6% to 15.5%.
• Incomplete sources of data on employment due to pause in data collection during COVID -19 lockdown hence, presenting shadowy picture of the recovery.
• Negative impact due to seasonal nature of employment widened with challenges associated education, place of residence and social background.
• Fragile Recovery: As employment of last resort should not be taken to imply a robust recovery.
  • DMAS data show that much of economic recovery after COVID rests on self-employment in agriculture or petty business.
  • Substantial decline in wage employment from 46% pre-Covid to 36% in July-September 2021 for men, and from 13% to 9% for women.
  • Increase in Self-employment in agriculture or small business from 36% to 41% for men, and from 21% to 24% for women.
• Informal self-employment workers are not fully cushioned against income shock: NCAER’s December 2020 NDIC’s Delhi NCR Coronavirus Telephone Survey 4 (DCVTS-4) found that
  • 9% households could no longer rely on their pre-pandemic primary source of income.
  • Data from an Azim Premji University survey in Rajasthan and Karnataka in February and August-September 2020 showed a startling increase in households reporting zero income.
• Sluggish employment recovery in urban areas compared to rural areas:
  • Before pandemic, Delhi NCR study found 81% employment among urban men, which dropped to 69% in July-September 2021, while rural male employment is at pre-pandemic level.
• Increasing employment inequality: Work participation for men who belongs to top one-fifth of economic status before pandemic has fully recovered from the employment loss.
• But, the bottom three quintiles have yet to recoup their employment losses.

Way forward: Restoring salaried work and upping wage employment in construction and manufacturing sectors shall be the policy priority

• Policy emphasis on expanding vaccination coverage that will help offices, factories and schools reopen fully, bringing back salaried jobs.
• Infrastructure push through labour-intensive urban infrastructure projects may enhance opportunities for urban casual labourers.