India’s unemployment rate sees sharp decline: Report

"This is a welcome trend and will contribute greatly for developing rural infrastructure," the report said.

By: PTI | New Delhi | Updated: March 5, 2017 1:49 pm

Contrary to market perception, India’s unemployment rate halved from 9.5 per cent in August 2016 to 4.8 per cent in February this year and among major states, a sharp decline was registered in Uttar Pradesh. According to the SBI Ecoflash, during August 2016 to February 2017, unemployment rate in Uttar Pradesh registered the maximum decline from 17.1 per cent to 2.9 per cent, followed by Madhya Pradesh (10 per cent to 2.7 per cent), Jharkhand (9.5 per cent to 3.1 per cent), Odisha (10.2 per cent to 2.9 per cent) and Bihar (13 per cent to 3.7 per cent).

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“We believe this decline is primarily due to the government’s efforts in providing new employment opportunities in rural areas,” said the report compiled by State Bank of India research team led by Group Chief Economic Advisor Soumya Kanti Ghosh. The report further noted that the decline was also explained by household demanded/allocated work under MGNREGA, which increased from 83 lakh households in October 2016 to 167 lakh households in February 2017.

Moreover, the number of works completed under MGNREGA increased by a whopping 40 per cent to 50.5 lakh in 2016-17 compared to 36.0 lakh in 2015-16. Notable increase was registered in the works of anganwadi, drought proofing, rural drinking water, and water conservation and harvesting.

“This is a welcome trend and will contribute greatly for developing rural infrastructure a sine qua non for sustained agri growth,” the report said. In the Union Budget FY18, MGNREGA scheme has been allocated a budgetary resource of Rs 48,000 crore.

During FY2017-18, another 5 lakh farm ponds will be taken up, compared to expected 10 lakh during FY2016-17. This single measure will contribute greatly to drought proofing of gram panchayats. The unemployment rate was estimated by BSE and CMIE from data collected regarding the employment/unemployment status of all members of 15 years and more of a sample of randomly selected households.

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First Published on: March 5, 2017 1:48 pm
  1. S
    Santhosham
    Mar 7, 2017 at 6:19 am
    The CSO has clarified that there was a base figure downward correction for Q3 2016 GDP growth figures, which had the effect of Q3 2017 GDP growth rate inflating to 7%. This is official figure.lt;br/gt;Unemployment rates cannot be halved in 3 months, when rural economy had "at least temporary pain " of demonetization, as admitted by govt. At best it could be UNEMPLOYMENT GROWTH RATE and NOT UNEMPLOYMENT RATE.lt;br/gt;India's potion is 130 crores and reduction in unemployment rate from 9.5% to 4.80% requires an employment generation of 6.11 crore jobs in 3 months. At this rate, annual job generation will be 24.40 crores fresh jobs.lt;br/gt;Is it simply possible?. What should be the investment required for 24.40 crores fresh job generation?. At the level of ₹50000 investment per fresh employment, this requires annual fresh investment of more than 12.20 lakh crore fresh investment, which is not happening. The fresh investment level is far below this. Look at the credit growth, which has a bearing on fresh investment and this level of employment generation is only imagination. lt;br/gt;It must be reduction in unemployment growth level and not unemployment level.
    Reply
    1. J
      Jai hind
      Mar 5, 2017 at 8:53 am
      Written By PTI. Paid teams of Indian express 😛😛
      Reply
      1. V
        Velington Fernandes
        Mar 6, 2017 at 6:10 am
        Demonetization happened...Workers left with no jobs in cities. migrated back to their villages. Picked up MNREGA jobs in villages. Reduction in unemployment in UP, Bihar, MP, etc. MNREGA is available on ground for 90-120 days only though government says otherwise.
        Reply