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Authors: Kiran Kumar Kakarlapudi , K Shagishna | Published on: 04-Oct-2023
Introduction
The outbreak of the COVID-19 crisis has disrupted the global socio-economic landscape resulting in an unprecedented decline in GDP growth, loss of lives and livelihoods of millions, and increased poverty and inequality. According to International Labour Organization (ILO 2021), 255 million full-time jobs are estimated to have been lost in 2020 due to the pandemic. As countries recovered from the COVID-19 shock in 2022, 52 million full-time jobs are yet to recover. The ILO (2022) shows that the labour market's recovery is highly uneven across the countries. While the high-income countries recovered the fastest, lower-middle-income registered a slow-paced recovery. As many scholars pointed out, India was grappling with very high levels of unemployment even before COVID-19 struck the economy. This situation worsened with the pandemic-induced lockdowns, with millions of people going without work for an extended period, resulting in a loss of income.
The issue of loss of employment and livelihoods during and after COVID-19 lockdowns has been subjected to intense debate and discussion. The evidence from the Centre for Monitoring Indian Economy (CMIE)-Consumer Pyramid Household Surveys (CPHS) showed a record rise in unemployment in the last week of March 2020 and April and May 2020 due to nationwide lockdowns. The last week of March 2020 recorded an unemployment rate of 23.8%, much higher than the first two weeks (7.6 %). It continued at 23.5 % in April and May 2020 and declined as the country relaxed the lockdown measures from mid-June 2020 (Vyas, 2020). As per CMIE-Consumer Pyramid Household Survey (CPHS), the average monthly employment in 2019-2020 was 403.7 million. The estimates published by the CMIE (2020) showed that 121.5 million people lost work in April 2020 due to the first lockdown indicating close to 30 per cent have lost their jobs. The severity of lockdowns had a differential impact on different sections. People working in the informal sector, casual labour, women, youth, and people belonging to marginalised communities lost significantly more jobs than others (ILO, 2020; OECD, 2020; United Nations, 2020).
However, the state-level experience of COVID-19 has been highly diverse in terms of COVID-19-related containment measures and caseload. The first COVID-19 case was reported in Kerala, but the state has effectively contained the spread of the virus in the first wave through coordinated efforts which have received international acclaim. However, the second wave has been devastating since Maharashtra and Kerala have accounted for more than 60 per cent of daily cases reported. Hence, the effect of COVID-19 on employment and its recovery is likely to be very different across states. Analysing the loss of employment across states, Kakarlapudi (2022) showed that Kerala experienced the highest employment loss during the first two waves of the pandemic.
This article analyses the unemployment trends of Kerala in comparison with other major states during and after the COVID-19 pandemic using the Employment Outlook publication of CMIE. The remainder of the paper is organised as follows. Section two presents the unemployment trends across states. Section three discusses unemployment differences across rural and urban areas. Section four presents gender-wise differences in unemployment. The last section provides concluding observations.
Unemployment rate across major Indian states in India
Due to the sudden lockdown in April 2020, employment declined in terms of both jobs and aggregate working hours (Mandal et al., 2020). The first wave of COVID (Q2 - April-May 2020) contributed to the increase in the unemployment rate by 23.5% (CMIE, 2020). The unemployment rate in Kerala doubled from 7.3 % in Jan-March 2020 to 14.8 % during April-June 2020. The increase is, however, lower than the national average, where the unemployment increased from 7.9 % to 18.4 % (about a 10% increase). Among other states, Jharkhand experienced the highest increase (32.2 %) in unemployment during the lockdown period, followed by Tamil Nadu (28.3%), Bihar (24.7%), and Karnataka (16.2%). The states with the lowest unemployment rise during the lockdown are Chhattisgarh, Assam, Rajasthan, and Telangana, with less than a four per cent rise. In the subsequent quarter, the unemployment trends restored to pre-pandemic levels in 10 out of 18 major states. Although Kerala's unemployment rate declined during July-September 2020, it was marginally higher (0.7%) than the pre-pandemic levels.
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