Real crisis | Business Standard Editorials

Just a day after two senior members of the National Statistical Commission (NSC) resigned, alleging that the government had withheld the release of a survey on the status of unemployment in the country, a report in Business Standard said that according to the Periodic Labour Force Survey (PLFS), conducted by the National Sample Survey Office (NSSO), the unemployment rate stood at a 45-year high of 6.1 per cent in 2017-18. The joblessness rate among the youth was at a significantly high level compared to the previous years and, as the report stated, “much higher compared to that in the overall population”. For instance, the rate of joblessness among rural males in the age group of 15-29 years jumped more than three times to 17.4 per cent in 2017-18 compared to 5 per cent in 2011-12. Similarly, the unemployment rate for the female youth in rural areas was 13.6 per cent in 2017-18 compared to 4.8 per cent in 2011-12. The situation got worse in urban areas, with the unemployment rates being 18.7 per cent for males and 27.2 per cent for females. The sharp drop in the employment rate, one of the lowest in the world, shows a real crisis, and completely negates India’s demographic dividend if people are not in the labour force. This was the first time that the NSSO conducted the PLFS — an annual survey mapping unemployment. Earlier, the NSSO used to conduct quinquennial surveys, which the government decided to do away with and opted for the PLFS. This is a good move because annual surveys provide a closer trace of unemployment. Moreover, the five-yearly surveys used to come with a lag of over one or two years, thus marring timely analysis.

On Thursday, the government said it was just a draft report and further work needed to be done before release. But the point is that despite the change in duration, the concepts of unemployment used in the PLFS are the same as those in all the previous quinquennial surveys. That is why the draft report stacks the unemployment rates of the PLFS as well as all the quinquennial rounds going all the way back to 1972-73. To be sure, the unemployment rates — based on Usual Status (principal status + subsidiary status) — across rural and urban males and females have shown a sudden and spectacular spike in 2017-18. It is true that as the full report is not available, it is unclear if the methodological factors such as the sample size and sampling design have reduced comparability. For instance, the quinquennial Employment-Unemployment Survey had a single country-wide sample, involving 100,000 households. The PLFS, being an annual survey, could have been on a smaller sample. Indeed, the official website suggests that the PLFS will have two separate samples — one for rural and another for urban areas — which will be refreshed in differing time-periods.

However, none of this should take away from the broader point. The government has been stalling the publication of an NSSO survey, which, it now transpires, presents an alarming picture of joblessness in India. Given that the field work for the collection of data was done between July 2017 and June 2018, these findings are significant because they confirm anecdotal evidence that economic activity took a big hit in the wake of the demonetisation move in November 2016.

via Real crisis | Business Standard Editorials

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