|Bye bye, jobless growth|
|Tuesday, 28 June 2011 00:00|
The significant decline in unemployment rates in all the four indicators for the first time in two decades bodes well for the economy. The NSSO’s 66th round data in 2009-10 indicates that the employment generated in the economy has picked up faster than the growth of the labour force, which is no mean accomplishment given that the number of persons joining the labour force has picked up significantly during the decade. Numbers show that the unemployment rates based on the current daily status (CDS), the most inclusive measure of unemployment, which went up from 6.1% in 1993-94, to 7.3% in 1999-2000 and further to 8.3% in 2004-05, has now been brought down to 6.6% in 2009-10. And if one looks at the usual primary status figures, which indicate the level of chronic unemployment, the unemployment rate has gone down to 2.5% in 2009-10, the lowest level in two decades—the earlier numbers being 2.6% in 1993-94, 2.7% in 1999-2000 and 3.1% in 2004-05. However, the CDS numbers show that while the unemployment rate of the male labour force has shrunk from 7.8% in 2004-05 to 6.1% in 2009-10, that of the female labour force has only come down from 9.2% to 8.2% during the period. And, surprisingly, most of the gains are in the urban sector where the reduction in the unemployment rate is almost double that of the rural sector. While the CDS unemployment rate in the urban sector has come down by 2.5 percentage points, from 8.3% in 2003-04 to 5.8% in 2009-10, that in the rural sector only slowed down 1.4 percentage points from 8.2% to 6.8%.
The higher unemployment rates and the slower decline in unemployment rates for women is a matter of concern as the share of the female labour force has dropped sharply. The numbers show that while the proportion of female labour in the total population has gone down from 215 per 1,000 population in 2003-04 to 179 per 1,000 in 2009-10, the ratio of the male labour force in the population has gone up marginally from 538 per 1,000 to 540 per 1,000 during the period. While some reduction in the share of the female labour force can be explained by the larger number of females pursuing higher education, there might also be other more complex factors that could be responsible for such a sharp withdrawal of women from the labour force, especially when programmes like MGNREGA have improved employment prospects in the rural sector. Only the detailed numbers will help explain the shrinking share of the female labour force despite the growing employment opportunities in the economy.