NEW DELHI: Even though India’s overall unemployment rate has declined in 2023 as compared to 2022, the joblessness within youth has started to rise again, according to data released by the Centre for Monitoring Indian Economy (CMIE) for October-December quarter.
For those in the age group between 20 to 34 years, the unemployment rate across the country has seen a sharp increase in Q3 FY24. The rate for 20-24 years group stood at 44.49% in October-December as against 43.65% in the previous quarter, while in the 25-29 years category, it stood at a 14-quarter high of 14.33% compared to 13.35% in July-September.
In the 30-34 years group, the joblessness rate was at a 10-quarter high of 2.49% as against 2.06% in the quarter before, the CMIE data showed.
This is largely a consequence of a rise in joblessness levels in rural areas as against urban. In the four categories of age groups mentioned above – the unemployment rate in rural areas rose in Q3 FY24 from Q2. And the highest joblessness amongst the four was witnessed in 20-24 years at 43.79% followed by 25-29 at 13.06%, 30-34 at 2.24%.
Urban unemployment rate, on other hand, recorded an improvement in levels within the age brackets 20-24 and 30-34 years in Q3 FY24 as compared to Q2. As per CMIE, the two age brackets recorded joblessness rates of 45.98% and 3.04% in Q3 compared to 47.61% and 3.29%, respectively. Age groups of 25-29 recorded a joblessness rate of 16.54% in October-December, higher from 15.61% observed in July-September.
The rise in unemployment levels particularly across age groups in rural areas paints a grim picture of the condition of joblessness in the economy. Data sourced from Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) also corroborates the findings to some extent from CMIE. As per MGNREGA dashboard, the work demanded by households in Q3FY24 was up by 1.3% year-on-year; but this was lower than the 15.1% increase recorded in Q2.
For the month of December – the unemployment rate in 20-24 years was at 45.38%, highest in four months; for 25-29 was at 15.45% – most in 43 months. Whereas, the unemployment rate in 30-34 years was at 1.61% – a seven month low.
“The unemployment rate as provided by CMIE keeps varying month on month which will be the case as the concept is amorphous given that a large part of the employment is in the informal sector where there may be no permanent employment,” said Madan Sabnavis, chief economist, Bank of Baroda.
Economists have raised concerns about the reliability of CMIE data due to the pronounced volatility in monthly figures. Nevertheless, the significance of CMIE data persists, as it remains the sole source offering an immediate snapshot of the unemployment situation in the country.
Source: The Financial Express
