Unemployment Rate in India, Current Rate is 8% February 2024

A recent report released by the International Labour Organization (ILO) and the Institute for Human Development (IHD) revealed that two out of every three unemployed individuals was a young graduate.

Unemployment Rate in India: CMIE

India continues to grapple with persistent unemployment concerns, marked by fluctuations evident across various regions and sectors. According to a recent report citing data from the Centre for Monitoring Indian Economy (CMIE) for February 2024, the national unemployment rate stands at 8 per cent as of February 2024.

Additionally, the latest Periodical Labour Force Survey indicates a positive shift in urban areas, revealing a one per cent decrease in the unemployment rate for individuals aged 15 and above, standing at 6.6 per cent in April-June 2023 compared to the previous year’s 7.6 per cent.

Recent weather patterns sweeping across the country have introduced significant economic changes. With rains covering substantial portions of India and impacting nearly half of the agricultural land, expectations for increased farm production have surged. This optimistic development holds the potential to contribute to overall economic growth and bolster labour demand within the agriculture sector.

The 2024 placement season at IIT Bombay reflects economic challenges, with 36% of students yet to secure jobs. Global economic downturns have led to company hesitancy in adhering to salary packages, particularly impacting computer science and engineering students. Despite efforts to maintain high average salary packages, student preferences increasingly diverge from offers, causing stress. The lack of support for unplaced students exacerbates concerns. Addressing these challenges is crucial for safeguarding the aspirations of India’s youth.

Graduate Unemployment Decline to 13.4% in 2022-23

The unemployment rate among graduates aged 15 and above dropped from 14.9% to 13.4%, as per the latest Periodic Labour Force Survey (PLFS) by the Ministry of Statistics & Programme Implementation.

• Regional Highlights: Chandigarh boasts the lowest unemployment rate at 5.6%, closely followed by Delhi at 5.7%. In contrast, Andaman & Nicobar Islands recorded the highest rate at 33%, with Ladakh and Andhra Pradesh at 26.5% and 24%, respectively.
• State Challenges: Rajasthan faces a significant unemployment rate of 23.1%, while Odisha experiences a rate of 21.9%.
• PLFS Insights: The PLFS, initiated in April 2017 for more frequent labour force updates, covered the period from July 2022 to June 2023. Challenges in data collection were noted in Manipur, impacting timely reporting.

Read this article below to get all about the Unemployment Rate in India, Trend of Unemployment, Highest Unemployed States and many more.

Unemployment Rate in India

As of March 2023, India’s unemployment rate, according to the Centre for Monitoring Indian Economy (CMIE), stood at 8.11%. In urban areas, the unemployment rate was 7.93%, while in rural areas, it was slightly lower at 7.44%. Notably, the states with the highest unemployment rates in India include Haryana, Rajasthan, Bihar, Jharkhand, and Jammu & Kashmir.

Among the union territories in India, Delhi recorded the highest unemployment rate. It’s worth mentioning that the unemployment rate in India increased from 8.00% in November to 8.30% in December 2022, marking the highest level in 16 months. These statistics provide insights into the employment challenges faced by different regions across the country.

What is the Unemployment Rate?

Current Unemployment Rate in India

• According to CMIE’s Consumer Pyramids Household Survey Unemployment rate in India has increased to eight per cent in February 2024 from 6.8 per cent in January 2024,
• While the unemployment rate eased in urban India, it rose substantially in rural India.
• The rural unemployment rate increased sharply to 7.8 per cent in February from 5.8 per cent in January.
• The urban unemployment rate fell from 8.9 per cent to 8.5 per cent.

Unemployment in Indian States

• Goa has the highest unemployment rate at nearly 10%, over three times the national average of 3.17%.
• Four of the top five states with the highest unemployment rates (Goa, Kerala, Haryana, and Punjab) are among the richer states, whereas Maharashtra and Gujarat, also rich states, have lower unemployment rates below the national average.

• All northern states (Jammu and Kashmir, Punjab, Haryana, Uttarakhand, Himachal Pradesh) and southern states, except Karnataka, reported higher-than-average unemployment rates.
• Twelve out of 27 states studied have unemployment rates below the national average, with large states like Maharashtra (3%), Uttar Pradesh (2.4%), and Madhya Pradesh (1.6%) contributing to lowering the national average.

Unemployment Rate in India State wise 2023

Center for Monitoring Indian Economy (CMIE) reported an increase in India’s unemployment rate to 8.30%, marking the highest level in 16 months, up from 8.00% in November. CMIE data also indicated that the urban unemployment rate climbed to 10.09% in December, compared to 8.96% in November, while the rural areas saw a slight decline from 7.55% to 7.44%.

For the year 2022, Haryana recorded the highest state unemployment rate at 37.4%, while Odisha had the lowest rate at 0.9%. The CMIE statistics released on March 1, 2023, provide a comprehensive breakdown of unemployment across different states in India for December 2022, shedding light on the varying employment challenges faced by these regions.

Statewise List of Unemployment Rate of India 2022

Here is the list of the Statewise and Monthwise as per the CMIE Report:

Trend of Last 10 Year Unemployment Rate in India

In India, the issue of unemployment is still a major one, with variations seen across various areas and industries. The latest Bloomberg study cites data from the Centre for Monitoring Indian Economy (CMIE) for September and states that as of September 2023, the country’s overall jobless rate will be 7.95 per cent. The Trends of the Last 10 Year’s Unemployment Rate in India has been mentioned in the table below:

Highest Unemployment Rate in India

Since January 2022, the employment rate has grown, reaching a record high of 37.1% in December 2022. With 28.5% in Rajasthan, 20.8% in Delhi, and 37.4% in Haryana, the unemployment rate increased in December 2022, as per the CMIE recent Report.

Unemployment Rate Calculator

The percentage of persons without a job is known as the unemployment rate. The percentage used to indicate this rate. The unemployment rate fluctuates according to the state of the economy. The employment rate will rise if the economy is struggling and there are fewer jobs available. Similarly, it is predicted that the unemployment rate will decrease when a nation’s economy is strong, growing, and offering the general populace a wide variety of job opportunities.

Unemployment Rate = Unemployed / Civilian Labor Force

Or

Unemployment Rate = No. of Unemployed Persons / (No. of Employed Persons + No. of Unemployed Persons)

Causes of Unemployment in India

In every nation, there are a variety of reasons that contribute to unemployment. Whether unemployment is brought on by a drop in the labour force or a lack of jobs determines whether it will be temporary or permanent. The main causes of unemployment in India are four different forms of unemployment.

These four categories of unemployment include structural, frictional, seasonal, and cyclical. Through expansionary monetary policy, we may combat seasonal and cyclical unemployment by raising public spending when times are tough. A few main causes of unemployment are:

• A sizable population
• The working population’s poor educational attainment or lack of vocational skills.
• Labour-intensive industries experiencing a downturn in private investment, especially the following demonetization.
• Transitioning between the three sectors is challenging due to the poor productivity in the agriculture sector and the dearth of alternatives for agricultural employees.
• Legal difficulties, insufficient government backing, and weak market, financial, and infrastructure ties to small firms render those operations unprofitable due to the cost and compliance overruns.
• Low investments in the manufacturing sector and inadequate infrastructural development, limit secondary sector job opportunities.

The government can build up a public employment program that produces full-time employment at minimum pay levels to create job stability, or it can provide temporary labour to unemployed individuals as part of the food-for-work program. Stabilizing market forces and lowering the trend toward structural changes or the necessity to fire people due to a lack of market demand, will lessen the cyclical type of unemployment.

Determinants of Unemployment

• A negative correlation exists between self-employment share in the labour force and unemployment rates, suggesting states with higher self-employment, often informal, have lower unemployment rates.
• The causal relationship between high unemployment and the lack or reluctance for self-employment remains unclear.

Impact of Urbanization and Agriculture

• A positive relationship is observed between urbanisation (urban share of the labour force) and unemployment rates.
• Highly urbanised states like Goa and Kerala show high unemployment, whereas states with large rural sectors like Uttar Pradesh, Jharkhand, and Madhya Pradesh have lower unemployment rates.

Education and Employment

• There’s a positive correlation between the proportion of graduates in the labour force and unemployment rates.
• States with higher education levels like Kerala have higher unemployment, while states with lower graduate percentages like Gujarat and Maharashtra have lower unemployment rates.
• The disparity may be due to graduates seeking higher-wage jobs, mismatched skills, or insufficient modern sector growth to absorb new graduates.

Additional Factors

State policies also significantly influence unemployment rates.

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