Unemployment rate rises to 14.5% in week ending May 16: CMIE

Weekly unemployment rate has seen a sudden rise to 14.45 per cent in the week ending May 16, data released by the private think tank Centre for Monitoring Indian Economy (CMIE) shows. This is almost double of 8.67 per cent unemployment rate on May 9. The current weekly unemployment rate stands at a 49-week high.

In the past year, unemployment was the highest in May 2020 at 21.73 per cent, when the country was facing the wrath of the first coronavirus wave. In the second Covid-19 wave, the month of April turned out to be worse than expected when it came to jobs as states resorted to strict lockdowns.

Also read: Unemployment rate shoots up to 8% in April; 7.35 million lose jobs: CMIE

The unemployment rate shot up from 6.5 per cent in March to 7.97 per cent in April, while the employment rate fell from 37.6 per cent in March to 36.8 per cent in April, shows the CMIE data.

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Also read: Unemployment rate highest since Dec 2020

As per the CMIE, the lockdowns could have denied people from seeking employment and caused a fall in labour participation. It said the economy was not in a position to provide jobs to a large number of people.

While the labour force shrank by 1.1 million in April, the count of the employed fell by a much larger 7.35 million, says the CMIE estimate. This fell from 398 million in March to 390.79 million in April. The CMIE data shows the count of the unemployed, who were willing to work and were actively looking for work but unable to find any, expanded by 6.2 million from 27.7 million in March to 33.9 million in April.

As per the think tank, while the fall in the LPR could be attributed to the partial lockdowns, the fall in employment cannot be attributed to the lockdowns. "Most of the job losses are from the agricultural sector, which is not impacted by the lockdowns. Of the 7.35 million people who lost employment in April, 6 million losses were from the agricultural sector. April is a lean month for employment on the farms. The rabi crop is harvested by then and preparations for the Kharif crop usually begin only in May. Agriculture employed 120 million in March. This dropped to 114 million in April," it said.

Also read: April unemployment rate up amid COVID-19 curbs