Sharp dip in urban unemployment: CMIE
India’s urban unemployment rate fell to 17.08% in the week ended 7 June from 25.14% in the week ended 31 May as per the data released by the Centre for the Monitoring of Indian Economy (CMIE). This development is a consequence of the resumption in economic activities and marks the lowest print since the lockdown began.
As on date, the urban job loss rate now stands less than both the national (17.51%) and rural unemployment (17.71%) rates. As more businesses open up, these figures are expected to drop further. However, there are some economists who opine that given that many medium and small enterprises have been winding up operations or plan to cut down workforce amid subdued demand, these figures might not be so optimistic. They add that in rural India where the unemployment rate is nearly 18%, the demand for jobs under MNREGA will rise and take the form of disguised unemployment once the sowing season draws to a close.
“The only reason why the numbers may have come down is because of the nature of lockdown now. From a massive nationwide closure to opening of the economy must have created some opportunities, let’s say for a shop owner to go to his store, a street vendor going out with his vegetables or essential items to sale. Overall, the service sector – small or big seems opening up gradually,” explains Praveen Jha, a professor of economics at the Centre for Economic Studies and Planning at JNU.