The unemployment rate in rural India nearly doubled soon after coronavirus-induced lockdown announced – from 6.8% in the pre-pandemic quarter of January-March 2020 to 12.1% in April-June 2020, the first quarter of March after the announcement of the national lockdown – As per Oxfam India report, ‘The India The ‘Discrimination Report’, released on Thursday.
The report noted that the unemployment rate in urban areas increased from 9% to 20.8% over the same period. The government’s Periodic Labor Force Survey (PLFS) defines unemployment as people who are looking for work or are available for work.
As per this definition, a section of regular/salaried workers and self-employed people who reported no work during the reference week were considered employed. The report said that many of them had neither work nor earnings, but since they were not looking for work or were not available, they were considered employed.
“However, when one broadens the definition and considers persons who did not work during the reference week as unemployed, an increase in the unemployment rate becomes alarming,” the report said. “In rural areas, the overall rate of unemployment” [in such a scenario] increased from 10.5 percent to 22.2 percent. The growth in urban areas is more alarming, with growth rising from 15 percent to 50.3 percent.
The study also found that according to both the indices, the increase in unemployment rate has been higher for people belonging to Scheduled Castes (SCs), Scheduled Tribes (STs) and Muslim communities as compared to the general category people.
According to the study, in terms of the distribution of workers across different forms of employment, the biggest injury during the pandemic period was on casual employment, which was relatively severe in urban areas due to the closure of non-farm activities. In line with this, self-employment increased, suggesting that people adopted such work as a part of their survival strategy.
In contrast, the report noted that the share of regular employment remained stagnant, or showed a slight decline.
This increase was much less for Muslims as compared to the significant increase in self-employment for SC/ST and general category people. The report said this could possibly be due to “lower acceptance of dealing directly with consumers at the household level”, which pushed them from casual employment to unpaid family labor or the unemployed category.
While the overall unemployment rate for Muslims rose from about 9% in the pre-pandemic quarter to 17% in the first quarter after the lockdown was announced, it rose to 7% for the general category from 7% in the same period .
Taking a broader definition of unemployment, the report noted that the sharpest increase in the unemployment rate in these two quarters was for Muslims in rural areas from 14% to 31%. According to the study, the respective increase in the rate was 11% to 22% and 10% to 20% for SC/ST and general category population.
“In rural areas, caste and religious identities become important, especially in times of crisis,” the report said. “People are likely to increase their behavior in their social circle. Due to the social and economic vulnerabilities of the SC/ST and Muslim population, the security they can give or demand from their group will be relatively poor. Therefore, it can be expected that the impact of discrimination will be far greater in rural areas than in the urban labor market.”
It said, “The overall impact of the pandemic has been severe in urban areas due to a series of national and state lockdowns that directly impacted urban business, social discrimination has been minimal, because of people’s professional identity by their caste or Blurs religious identity in contrast to rural areas.”
According to an Oxfam study, regular/salaried employees who did not report work for two consecutive quarters increased from 5.9% to 29.7%. The increase was more alarming in urban areas – from 6.9% to 39.4%. For Muslims, the increase was from 11.8% in January-March 2020 to 40.9% in April-June that year.
Oxfam’s analysis also found that women in regular employment increased during the April-June 2020 quarter, despite a decline in men’s employment.
The report explained: “In urban areas, a large section of female regular workers are engaged in domestic and unskilled jobs. Many of them provided daily support services at relatively low cost, which the upper and middle classes found it convenient to maintain with full or partial payments. ,
The study found that the average earnings of workers across all social groups and employment categories declined significantly in the April-June 2020 quarter. In rural areas, monthly income during the first quarter after COVID-19 9% lower than the 2019-20 average. However, the deficit was markedly higher in urban areas at 21%.
In rural areas, the Muslim community registered the maximum decline – 13% – and it was close to the average for the rest.