Periodic Labour Force Survey

Context:

The unemployment rate saw a decrease of 0.6% and fell to 4.2% in 2020-21, compared with 4.8% in 2019-20, according to the Periodic Labour Force Survey (PLFS) for 2020-21 released by the Ministry of Statistics and Programme Implementation.

• This means that only 4.2% of adults who looked for jobs could not get any work in rural and urban areas of the country in 2020-21.

Relevance:

GS III- Indian Economy (Employment)

Dimensions of the Article:

1. Key Employment and Unemployment Indicators
2. What is the Periodic Labour Force Survey?
3. Types of Unemployment in India
4. Causes of Unemployment in India
5. Highlights of the Report:

Key Employment and Unemployment Indicators

• Labour Force Participation Rate (LFPR): LFPR is defined as the percentage of persons in labour force (i.e. working or seeking or available for work) in the population.
• Worker Population Ratio (WPR): WPR is defined as the percentage of employed persons in the population.
• Unemployment Rate (UR): UR is defined as the percentage of persons unemployed among the persons in the labour force.
• Activity Status- Usual Status: The activity status of a person is determined on the basis of the activities pursued by the person during the specified reference period. When the activity status is determined on the basis of the reference period of last 365 days preceding the date of survey, it is known as the usual activity status of the person.
• Activity Status- Current Weekly Status (CWS): The activity status determined on the basis of a reference period of last 7 days preceding the date of survey is known as the current weekly status (CWS) of the person.

What is the Periodic Labour Force Survey?

• Nodal for the Periodic Labour Force Survey (PLFS) is the Ministry of Statistics.
• In April 2017, the National Statistical Office (NSO) introduced the Periodic Labour Force Survey (PLFS).
• The primary goal of PLFS is two-fold:
  • To estimate key employment and unemployment indicators (such as the Worker Population Ratio, Labour Force Participation Rate, and Unemployment Rate) in the Current Weekly Status (CWS) for urban areas only in a short time interval of three months.
  • To estimate employment and unemployment indicators in both usual status (ps+ss) and CWS in both rural and urban areas on an annual basis.

Types of Unemployment in India

• Disguised Unemployment: This is a situation in which more people are employed than are required. It is mostly seen in India’s agricultural and unorganised sectors.
• Seasonal unemployment: Unemployment that happens only during particular seasons of the year. In India, agricultural labourers rarely work throughout the year.
• Structural Unemployment: This is a type of unemployment that occurs when there is a mismatch between the jobs available and the abilities of the available workers.
• Cyclical unemployment: Unemployment that rises during recessions and falls with economic expansion. It is mostly a phenomenon of capitalist economies.
• Frictional Unemployment:  It is also known as Search Unemployment, is the time lag between jobs when someone is looking for a new job or moving jobs.

Causes of Unemployment in India

• Jobs in the capitalist world have become highly specialised but India’s education system does not provide the right training and specialisation needed for these jobs.
• In India nearly half of the workforce is dependent on Agriculture – even though agriculture is underdeveloped in India and only provides seasonal employment.
• Mobility of labour in India is low due to factors like language, religion, and climate.
• The industrial development had adverse effects on cottage and small industries – as the cottage industries fall, many artisans become unemployed.
• Constant increase in population has been a big problem and one of the main causes of unemployment.
• Certain work is prohibited for specific castes in some areas and this also contributes to unemployment.

Highlights of the Report:

• Rural areas recorded an unemployment rate of 3.3% and urban areas 6.7%.
• The LFPR, the percentage of persons in the labour force (that is, working or seeking work or available for work) in the population, was 41.6% during 2020-21. It was 40.1% in the previous year.
• The WPR was 39.8%, an increase from 38.2% of the previous year.
• Migrants are defined in the survey as a household member whose last usual place of residence, at any time in the past, was different from the present place of enumeration.
  • The migration rate, according to the survey, is 28.9%.
  • The migration rate among women was 48% and 47.8% in rural and urban areas, respectively.
• Overall, the report suggests shifting the government’s policy directions as it has become more rural-centric.
• Creation of rural jobs other than in the agricultural sector and MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act) could be priorities for the government at the Union and State levels

-Source: The Hindu