Unemployment rate drops to 6.4% in Sept; lowest in 4 yrs

India's unemployment rate fell to 6.43% in September 2022, its lowest level since August 2018 and after touching a one-year high of 8.3% in August 2022, the latest data shared by the private think tank Centre for Monitoring Indian Economy (CMIE) shows. The jobless rate fell in both urban and rural parts of the country, thanks to the addition of new jobs during September 2022. In urban areas, the unemployment rate fell to 7.7% from 9.57%, while it dropped to 5.84% from 7.68% in rural areas of the country.

As of October 2, 2022, the country's jobless rate stands at 6.5% -- urban at 7.7% and rural at 6%. The unemployment rate is the highest in Rajasthan at 23.8%, followed by J&K at 23.2%, Haryana at 22.9%, Tripura at 17%, Jharkhand at 12.2% and Bihar at 11.45%. The fall in the unemployment rate follows after around 8 million jobs were added in September 2022. The lowest unemployment rate among the states was recorded in Chhattisgarh at 0.1% in September, followed by Assam at 0.4%, Uttarakhand at 0.5%, Madhya Pradesh at 0.9%, and Gujarat at 1.6%.

India’s labour force grew by 4 million to 430 million in August 2022, reflecting an increase in the demand for employment. The additional demand came from labour. "The additional demand has come from labour that was earlier on the periphery of the labour markets. These migrated into the labour market and were actively looking for employment in August," CMIE CEO Mahesh Vyas had said in an article ‘Employment fell in August 2022’.

According to the labour ministry's 4th quarterly employment survey (January-March, 2022) report released on September 27, 2022, employment is showing an increasing trend in the selected sectors of the economy. The survey shows the estimated employment increased from 3.14 crore in the third quarter to 3.18 crore in the 4th quarter. The manufacturing sector accounted for the largest percentage (38.5%) of the total number of workers, followed by the education sector with 21.7%, the IT/BPO sector with 12% and the health sector with 10.6%.

Female workers’ participation reported a marginal increase from 31.6% in the third quarter to 31.8% in the 4th quarter report of 2021-22. However, female workers constituted about 52% of the workforce in the health sector, and the corresponding percentages in education, financial services and IT/BPO sector stood at 44%, 41% and 36%, respectively. Women far outnumber men among self-employed persons in financial services.