India’s unemployment rate post-Covid-19 is lower than it was in the pre-Covid-19 era, but joblessness remains high among young college graduates, according to a new report.
“Post Covid, the unemployment rate is lower than it was pre-Covid, for all education levels. But it remains above 15 per cent for graduates and more worryingly, it touches a huge 42 per cent for graduates under 25 years,” said the State of Working India 2023 report, which was released on Wednesday.
Using data from the Periodic Labour Force Survey 2021-22, the report said that there is a large variation in the unemployment rate within the higher educated group. As the age of the graduates increases, the rate of unemployment falls. The unemployment rate is 4.5 per cent for graduates in the age group of 35 to 39 years and declines further to 1.6 per cent for graduates who are 40 years of age and above.
“This indicates that eventually graduates do find jobs but the key questions are, what is the nature of jobs they find and do these match their skills and aspirations? More research is needed on this important topic,” said Amit Basole, lead author of the report and Professor of Economics at Azim Premji University.
The report is by Azim Premji University and draws on evidence from official data sources and a primary survey, the Indian Working Survey, conducted in collaboration with IWWAGE and IIM Bangalore.
According to the PLFS Annual Report 2021-22, the unemployment rate declined to 4.1 per cent in the period from 4.2 per cent in 2020-21.
Meanwhile, the State of Working India 2023 report highlighted that job creation continues to be India’s main challenge. The last few years have seen the creation of more formal salaried jobs than earlier, it further said, but noted that women were compelled to enter self-employment due to distress from the pandemic and the global slowdown.
“Between 2017 and 2021, there was a slowdown in overall regular wage job creation but formal jobs (with a written contract and benefits) as a share of all regular wage work rose from 25 per cent to 35 per cent,” it said, adding that in 2020-21, which was the pandemic year, regular wage employment fell by 2.2 million.
But this net change hides an increase in formal employment by 3 million and a loss of about 5.2 million of semi and informal regular wage employment.
“While half of the lost employment is accounted for by women, only a third of the increase in formal employment accrued to women,” the report said. In net terms, women lost out on formal employment in this period and moved to self-employment due to distress.
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