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The unemployment rate increased in April.

In terms of the most critical fast-frequency labour statistic, April may be the third consecutive month of decline. During the second phase of the pandemic, unemployment increased to 8% in April 2021, up from 6.5 percent in March 2021. 

The layoffs follow a month of exploding covid events, which have caused business and mobility restrictions in many parts of the world. 

According to the Centre for Monitoring Indian Economy, the unemployment rate inched up in April and is expected to close the month at a higher rate than March, as India battles the second wave of coronavirus cases and states enforce restrictions to curb the spread of infections.

This month India's unemployment rate reached a new high of 7.97 percent. Unemployment rates have risen in both urban and rural areas. In urban areas, it was 9.78 percent, the highest since August 2020, and in rural India, it was 7.13 percent, the highest since December 2020.

In January 2021, the national unemployment rate was 6.52 percent, 6.89 percent in February, and 6.5 percent in March. In April, all three labour market ratios deteriorated: the labour participation rate, job rate, and unemployment rate. 

On the job front, the situation is projected to remain difficult in the future as well. People lost 75 lakh jobs in April compared to March, which is what has caused the unemployment rate to rise.

The growing number of unemployed people that are not actively searching for work means that people have withdrawn from the labour market for two reasons: one, the virus has now spread to rural India, and two, there aren't enough jobs available due to closures, for e.g.  The formal industries, such as retail, hospitality, tourism and travel industries, as well as the informal and semi-formal divisions, such as staff in domestic work, office support systems, and so on.

Since 2013-14, April saw the highest demand for jobs under the Mahatma Gandhi National Rural Employment Scheme (MGNREGS), both at the household and personal level. 

This may be the product of the reverse migration that has been occurring in the country since the first lockdown in April 2020.

The next two to three months will be critical, and the sustainability of the employment market will be determined by how well we tackle the situation.


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