With the rise in Covid-19 cases in India in an expedited manner in April, the unemployment rate has also risen to a four month high of 8%. It has impacted over 7 million jobs across the country. With the worsening of Covid-19 Situation in India, this unemployment situation shall also be worsening but to some other extent. If this situation is not controlled by May then we can see a huge surge in COVID as well as Unemployment. Localized Lockdowns are also one of the contributing factors in it.
According to data from a private research firm, Centre for Monitoring Indian Economy Pvt.,The Rate of Unemployment has risen to 7.97% from 6.5% in March, with more than seventy lakh jobs lost last month.
“There is a fall in the jobs available. This could be due to the lockdowns,” CMIE Managing Director and chief executive Mahesh Vyas told TOI. “Since the virus is still quite intense and we are stressed on the medical health-services front, it’s likely that the situation will remain tense in May as well.”
“It’s a double whammy for the economy,” Vyas quoted. Vyas further added, “Some people get disappointed and leave the labor market. The problem is the inability of the Indian economy to generate sufficient jobs for people who want them, so incomes are falling.”
Data from the survey by IHS Market shows that Jobs most lost are from the Manufacturing sector in April, even though the rate of contraction was the weakest considering the current 13-month sequence of Job-Shedding. The CMIE data, which is closely observed by the economists to track the absence of real time employment, shows that in Urban areas the Job Loss is acute as the labourers have returned to their village owing to the Pandemic.
On the other hand, Barclays Bank Plc, a British Multinational Investment Bank has lowered its forecast by one percentage point to 10%, as “there is growing uncertainty around the number of cases and fatalities owing to COVID-19 pandemic,” economist Rahul Bajoria quoted in a research note. He further added, “Slowing vaccinations are also hurting India’s recovery prospects.”
Now that India is reporting around 4 lakh new infections everyday in its second wave and over 3,000 deaths, the number is surely to increase and wreak havoc on the economy.