July unemployment rate reduced to 7.43% in India, back at pre-Covid-19 level

July 2020, showed a remarkable drop in the rate of unemployment, reducing it to the pre-lockdown levels. During the past three months, due to the then persisting strict lockdown rules, India had experienced a massive increase in unemployment, which now had declined to a quite noticeable rate.

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July unemployment rate reduced to 7.43% in India, back at pre-Covid-19 level. The poliucy times

July 2020, showed a remarkable drop in the rate of unemployment, reducing it to the pre-lockdown levels. During the past three months, due to the then persisting strict lockdown rules, India had experienced a massive increase in unemployment, which now had declined to a quite noticeable rate.

According to the recent data of the Centre of Monitoring Indian Economy (CMIE), India’s unemployment rate in July had reduced to 7.43% which was 10.99% in the month of June. This count is even lower than the March unemployment rate of the country that was 8.75%. Not only that, the rural unemployment rate per month had also declined in July to 6.6%, which read 10.52% in June.

Reasons for a reduction in the unemployment rate

  • A good monsoon this year had resulted in a better sowing season in rural parts of India, which in turn had increased the employment level.
  • The lockdown that prevailed during the past three months had made people have a broader outlook towards self-employment, both in rural and urban India.
  • Due to the lockdown crisis, people had even opted for jobs, which they would have rejected otherwise.
  • Rural India had also shown an increase in employment due to the rural job guarantee programmes such as Mahatma Gandhi National Rural Employment Guarantee Scheme that ensures and helps the people to get employed by various means.

Even though the overall unemployment rate had decreased, the urban unemployment rate had remained higher than that of the rural and national rates. CMIE recorded the urban joblessness rate to be 9.15% in July against 12.02% in June. It had also been recorded that the urban unemployment rate had increased to 25.79% and 24.95% in May and April respectively.

Although there is a reduction in the unemployment rate, the country should not avoid issues like distress employment, low productivity, income growth of workers, etc. because the job that was done by lesser people before are now done by more people. As the market demand had toned down since the last few months, the decent and formal sector job creation had been moving at a low pace and will take time for recovery. The rural sectors are doing well and showing noticeable growth in demand, but for them too, it is a lengthy process.



 

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July unemployment rate reduced to 7.43% in India, back at pre-Covid-19 level
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July 2020, showed a remarkable drop in the rate of unemployment, reducing it to the pre-lockdown levels. During the past three months, due to the then persisting strict lockdown rules, India had experienced a massive increase in unemployment, which now had declined to a quite noticeable rate.
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THE POLICY TIMES
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