India’s unemployment rate has gone up to 27.11% for the week ended May 3, up from under 7% before the start of the pandemic in mid-March, the Centre for Monitoring Indian Economy (CMIE) said on Tuesday. The government doesn’t publish unemployment data regularly. The last official figures were released in May 2019 and estimated the unemployment rate at 6.1% in the year to June 2018.
Where: The rate of unemployment was the highest in the urban areas, where most of the Covid-19 red zones are, at 29.22%, as against 26.69% for the rural areas. As of the end of April, Puducherry had the highest rate of unemployment at 75.8%, followed by Tamil Nadu at 49.8%, Jharkhand at 47.1% and Bihar at 46.6%. Maharashtra had an unemployment rate of 20.9%, while it was 43.2% in Haryana, 21.5% in Uttar Pradesh and 29.8% in Karnataka. Hilly states were better off with the rate in Himachal Pradesh at 2.2%, Sikkim at 2.3% and Uttarakhand at 6.5%.
How: CMIE’s weekly series of data shows a steady increase in unemployment since the start of the pandemic, with the week to March 29 showing the sharpest spike to 23.81%. The monthly unemployment rate in April stood at 23.52%, up from March’s 8.74%. “This worsening should be expected as the lockdown continues to get prolonged. Initially, a lockdown only hurts the most vulnerable labour that is informally employed in unorganised sectors. Gradually, it starts hitting the more secure jobs,” says Mahesh Vyas, MD and CEO of CMIE.
Then: Global ratings agency S&P on Tuesday said additional financial stimulus is “necessary” in India to fight the pandemic, despite the country’s weak fiscal position. Nobel laureate Abhijit Banerjee said he favours putting cash in the hands of the bottom 60% population to help boost the economy post lockdown.
