Unemployment rate in urban areas dips to 6.8% in March quarter

India's unemployment rate in urban areas declined to 6.8% in the January-March period of FY23, according to the period labour force survey (PLFS) data released by the National Statistical Office (previously known as National Sample Survey Organisation) under the Ministry of Statistics & Programme Implementation on Monday. In the October-December period in FY23, the unemployment rate stood at 7.2%. This is the lowest unemployment rate since 2018 after the country’s urban unemployment rate touched a peak of 20.8% in the October-December period of FY21.

Among males aged above 15 years, the unemployment rate stood at 9.2% in the March quarter as against 9.6% in the December quarter. For females aged above 15 years, the unemployment rate stood at 6% during the quarter under review, as against 6.5% in the December quarter.

During the quarter under review, the labour force participation rate (LFPR) increased marginally to 48.5% as against 48.2% in the December quarter. LFPR is defined as the percentage of persons in the labour force (i.e. working or seeking or available for work) in the population. The LFPR for females and males stood at 22.7% and 77.5%, respectively in the March quarter. In the December quarter, the LFPR rate for females and males stood at 73.3% and 22.3%, respectively.

The work population ratio (WPR), which is the percentage of employed persons in the population, during the quarter under review stood at 45.2% as against 44.7% in the December quarter. Amongst females, the WPR stood at 20.6% during the quarter under review, as against 20.2% in the October to December period of FY23. Amongst males, the WPR stood at 69.1% in the March quarter as against 68.6% in the December quarter of FY23.

The Ministry of Labour & Employment had earlier told the Parliament that the country’s estimated unemployment rate on usual status for persons of age 15 years and above, was 6%, 5.8%, 4.8% and 4.2% during 2017-18, 2018-19, 2019-20 and 2020-21, respectively, and has been showing a declining trend. “The estimated Worker Population Ratio (WPR) on usual status for persons of age 15 years & above was 50.9% and 52.6% during 2019-20 and 2020-21, respectively, which shows that employment in the country has increased," said Rameswar Teli, Minister of Labour and Employment.

Notably, the unemployment rate in March stood at 7.8%, according to the data released by the Centre for Monitoring Indian Economy (CMIE). In January and February, the unemployment rate stood at 7.45% and 7.14%, respectively. In urban areas, the unemployment rate was 8.5% in March 2023, up from 7.9% in February 2023, while in rural areas, the joblessness rate stood at 7.4%, up from 7.2% in the previous month. 

 Last week, the Employees’ Provident Fund Organisation (EPFO) said that around 1.39 crore net members were added by the body in FY23, with an increase of 13.22% compared to FY22 wherein it added around 1.22 crore net members.