Urban unemployment rate drops to 6.6% in Q1

The Ministry of Statistics and Programme Implementation (MoSPI) released its quarterly bulletin of the Periodic Labour Force Survey (PLFS), shedding light on the urban unemployment situation in India during the first quarter of the fiscal year.

Decline in Urban Unemployment Rate

In the April-June quarter of this fiscal year, the urban unemployment rate in India dropped to 6.6%.
This was the lowest level recorded since the PLFS bulletin was launched in 2018.

Gender-Based Analysis

For males above the age of 15, the urban unemployment rate decreased from 6.0% in the previous quarter to 5.9%.
For females in the same age group, the unemployment rate decreased from 9.2% to 9.1% during the same period.

Employment in Self-Employed Categories

Both males and females saw an increase in employment in self-employed categories, including own account workers and helpers in household enterprises.

Youth Unemployment

Among urban females aged 15-29, the unemployment rate slightly increased to 23.4% in April-June from 22.9% in the previous quarter but was lower than the 23.9% recorded in the same period the previous year.
Urban males in the 15-29 age group also saw a slight increase in unemployment, rising to 15.9% from 15.6% in the previous quarter but lower than the 17.4% recorded in April-June 2022.

State-wise Variation

Several states and union territories (UTs) reported higher urban unemployment rates than the national average. Notable ones include Himachal Pradesh (13.8%), Rajasthan (11.7%), Chhattisgarh (11.2%), Jammu and Kashmir (10.9%), and Kerala (10%).
States/UTs with lower-than-national average unemployment rates included Delhi (2.7%), Gujarat (2.8%), West Bengal (4.4%), Bihar (6.1%), Maharashtra, and Haryana (6.5%).

Positive Labor Market Indicators

Key labor market indicators, such as Labour Force Participation Rate (LFPR) and Worker Population Ratio (WPR), improved in urban areas for individuals aged 15 years and above compared to the pre-pandemic period.
LFPR in April-June 2023 was 48.8%, higher than the pre-pandemic levels.
WPR in the same period was 45.5%, also surpassing pre-pandemic figures.
The current unemployment rate of 6.6% is lower than pre-pandemic unemployment rates.

Pandemic Impact

During the first wave of the pandemic in 2020, urban unemployment rates had surged significantly.
For urban females and males in the 15-29 years age group, the unemployment rates were exceptionally high at 36% and 34.3%, respectively, in April-June 2020.

Definition of Unemployment Rate

It is the percentage of people unemployed among those in the labor force. People are considered unemployed if they didn’t work for even one hour during the week but sought or were available for work for at least one hour during the same period.

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