Ease In Unemployment Rate In June Drops To 11% From 23.5% In May

Unemployment Rate In India Down By 12.5% In One Month


  • The unemployment rate in India has dropped down 12.5% as per data shared by CMIE
  • The unemployment rate in India in May was 23.48% while in June has come down to 10.99%

The unemployment rate in India has dropped down to 10.99% in the month of June which in May was at a staggering 23.48% said the Centre for Monitoring Indian Economy (CMIE) in the monthly data.

This decline in the unemployment rate is majorly in sync with the trend witnessed in the week-on-week data.

The data of June month is reflective of the resumption of activities as the first phase of unlocking the Indian economy i.e. Unlock 1.0, started from the 1st of June 2020 and continued to open up various other sectors. Self-employment domains opened up and the pace at which the Kharif crops are being sowed has picked up following the food progress of Monsoon.

The rate at which jobs were lost in the rural areas of India stood at 10.52% in June, down from 22.48% in May. For the urban areas, the unemployment rate in June stood at 12.02% while the same for May was 25.79%.

Having said this, the June unemployment number is still higher than the numbers recorded in February and March. The overall unemployment rate in February stood at 7.76% while in March it was recorded at 8.75%.

The spike in the cases of the novel Coronavirus in the country and the implementation of a pan India lockdown to curb the spread of COVID-19 in India but it also made April and May the worst months for the labour market.

The drop in the month-on-month data is in sync with the drop captured in the weekly data. The Rural unemployment rate has climbed down from its highest of 26.16% in the week ended on 3rd May to a low of 7.26% in the week which ended on the 21st of June.

Economists believe that the loss in business and the shrink in demand in the market could slow the progress of the creation of new jobs in the market and said that the fall in the unemployment rate in June was majorly due to the Unlock 1.0 where the agricultural activities and better allocation under the rural employment guarantee scheme were implemented.

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The urban unemployment in India, however, remains almost the same as it only dropped by a measly 0.6% point in the week which ended on the 28th of June compared to the week before. As the industrial production is yet to pick up the pace as it stares right at a fresh round of lockdown in several parts of India.

Economists claim the pain may last longer.

Earlier, the CMIE’s weekly data reported that the urban unemployment rate in the week to 21st June was recorded at 11.29% which in the ween to June 28th fell down to 10.69%. the report was released earlier this week.

The rural unemployment and the overall national unemployment rose marginally for the first time in six weeks. The unemployment rate in rural areas of India surged to 7.62% from 7.26% in the previous week as per the data shared by CMIE for the week ended on the 28th of June.

The labour economists argue that the rural employment condition is still much better than the urban employment rate credits given to the healthy sowing season and various other options available in the informal jobs sector.

Comparing the unemployment in the formal sector, the creation of jobs is driven by demand which will take time to be revived, they added.

K R Shaymsundar, a Labour Economists and a Professor at XLRI Jamshedpur said, “The labour-intensive manufacturing and heavy machine segments are not functioning with optimal resources, the demand in the market is low and the support supply chain is structurally weak.”

He added, “Besides, MSMEs are in a bad shape and formal sectors are shedding jobs for survival,”.


Aishwarya Chopra

A news content writer with a bachelor’s degree in Mass Communications and has over 4 years of experience. Aishwarya is fluent in multiple languages and covers different domains of news for XploringIndia.in. In the past, she has worked as a freelancer and curated multiple articles for various websites.

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