India’s unemployment rate falls further to 4.2% in 2020-21

India’s unemployment rate fell further to 4.2% in 2020-21 despite this period witnessing two waves of the pandemic which had left millions of workers without work and resulted in suspension of field work, shows the periodic labour force survey by the ministry of statistics and programme implementation released.

The unemployment rates (UR) in India stood at 4.8% in 2019-20, 5.8% in 2018-19 and 6.1% in 2017-18. Mospi’s annual PLFS for urban and rural India captures data from July to June. UR is defined as the percentage of persons unemployed among the persons in the labour force.

As per the annual report, even the labour force participation rate (LFPR) has gone up in the country year-on-year to 41.6% in 2020-21 c compared to 40.1% in 2019-20, 37.5% in 2018-19 and 26.9% in 2017-18. LFPR is defined as the percentage of persons in the labour force (i.e. working or seeking or available for work)in the population.

This is on the back of significant improvement in female labour force participation during this period, the data shows. Female labour force participation jumped to 25.1% in the 2020-21 survey period from 22.8% in the preceding year, 18.6% in 2018-19 and 17.5% in 2017-18.

The annual data also points to a surge in worker population ratio (WPR) to 39.8% from 38.2% in 2019-20, 35.3% in 2018-19 and 34.7% in 2017-18. WPR is defined as the percentage of employed persons in the population.

Out of the total number of 12,800 first sampling units (FSUs) (7,024 villages and 5,776 UFS blocks) allotted for the survey at the all-India level during July 2020- June 2021, a total of 12,562 FSUs (6,930 villages and 5,632 urban blocks) were surveyed for canvassing the PLFS schedule, Mospi said in its report.

The number of households surveyed was 1,00,344 (55,389 in rural areas and 44,955 in urban areas) and number of persons surveyed was 4,10,818 (2,36,279 in rural areas and 1,74,539 in urban areas).