The Dramatic Increase in the Unemployment Rate -Prabhat Patnaik
The Periodic Labour Force Survey Report 2017-18 clearly shows that there is a sudden jump in the unemployment rates across-the-board in 2017-18, compared to all preceding rounds of the NSSO.
The report of the Periodic Labour Force Survey (PLFS) conducted in 2017-18 is finally out, and it confirms what had been leaked earlier, namely a dramatic increase in the unemployment rate in the Indian economy. The unemployment rate is given under two heads: usual status unemployment and current weekly status unemployment. These can be understood as follows.
If a person is employed or seeking work for more than half the time (“majority time”) during the preceding 365 days before the date of the survey then his or her “usual status” is that he belongs to the labour force; but if the person does not succeed in getting work for more than half the time then he or she is considered “usual status unemployed”.
A further modification is made to this to make it less restrictive. All individuals who are outside of the labour force according to the above definition, or are unemployed, but have worked for not less than 30 days during the reference year are classified as “subsidiary status” workers. The total labour force then is defined as “Usual Status (Principal Status plus Subsidiary Status)” workers. Likewise, all unemployed according to the above criterion who have worked for not less than 30 days are considered to have been employed in a “subsidiary status” activity. The Usual Status (PS+SS) unemployment rate, therefore is less than the simple “Usual Status” unemployment rate for two reasons: first, the denominator, labour force, is higher because of the inclusion of persons who may have worked in a subsidiary activity; and second, the numerator, unemployment, is lower because of the inclusion of persons who may have worked in subsidiary activities.
Finally, if a person is working, or available for work, even for just one hour during the week preceding the survey, then that person belongs to the Current Weekly Status (CWS) labour force. But if that person is unable to obtain even one hour of work during the entire week, then he or she is considered unemployed on the CWS basis. These are the concepts of unemployment which the National Sample Survey Organisation (NSSO) uses and on which the PLFS provides data for 2017-18. Let us see what the data show.
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