Periodic Labour Force Survey (PLFS), commissioned by the National Statistical Office (NSO), gives comprehensive data on the unemployment rate, a pivotal economic indicator that represents the percentage of unemployed people in the labour force. The NSO, under the Ministry of Statistics and Programme Implementation, has been conducting this survey since April 2017 given the significance of frequent labor force data.
The recently published PLFS revealed a spike in India’s unemployment rate during the first wave of the COVID-19 pandemic in 2020, which can be largely attributed to the nationwide lockdown.
Explanation of Unemployment Rate and Labour Force
According to the Current Weekly Status (CWS) approach utilized for the PLFS, an individual is considered a part of the labour force if they are either employed or unemployed during the week preceding the survey date. Consequently, the unemployment rate is determined as a percentage of these non-working individuals who have sought or were available for at least one hour of work during that week.
As per the CWS approach data, the labour force participation rate of urban people aged 15 years and above was recorded at 46.8% in the second quarter of 2021.
Understanding the Periodic Labour Force Survey
The central objective of the PLFS is two-fold. Firstly, it aims to calculate crucial employment and unemployment statistics such as Worker Population Ratio, Labour Force Participation Rate, and Unemployment Rate every three months for urban areas only. Secondly, it provides annual employment and unemployment figures for both rural and urban areas under the usual status and CWS basis.
Recent Government Measures Against Unemployment
Several government initiatives have been introduced to combat unemployment, including support schemes for marginalized individuals (SMILE), PM-DAKSH program, Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), Pradhan Mantri Kaushal Vikas Yojana (PMKVY), and the Start Up India Scheme.
Dissecting Types of Unemployment in India
India grapples with various forms of unemployment. Disguised Unemployment is when more people are working than necessary, often seen in the farming and unorganized sectors. Seasonal Unemployment is a result of certain jobs being available only during specific periods of the year. Poor education and skill levels create Structural Unemployment due to the mismatch of skills and job openings. Cyclical Unemployment arises due to economic fluctuations, while Technological Unemployment is attributed to automation.
Frictional or Search Unemployment is the time taken by individuals to find new jobs or transition between jobs. Another type, Vulnerable Employment, refers to those working informally, without any legal protections.
Socio-Economic Indicators and Unemployment
An increase in absolute and per capita real GNP does not necessarily denote a higher level of economic development. For instance, if poverty and unemployment intensify, then despite the growth in GNP, the economy does not truly develop. This highlights the complexity of economic development and the centrality of employment in it.
