Modi sweats as India bleeds 1.6 million unorganised sector jobs

Bengaluru, NT Bureau: Union government data has revealed that India lost at least 1.6 million jobs in the unorganised sector in eight years.

The Ministry of Statistics and Programme Implementation report entitled “Annual Survey of Unincorporated Sector Enterprises” said that 109.6 million people had been working in the unorganised (non-farm) sector between October 2022 and September 2023.

However, government data put the same figure at 111.3 million in 2015-16 The “unincorporated sector” refers to businesses that have not been set up as separate entities and include the likes of street vendors, their hired workers and unpaid family members.

Demonetisation, lockdowns recalled

The figures also brought the spotlight back on policy decisions like demonetisation in November 2016 when Prime Minister Modi had declared the old Rs 500 and Rs 1,000 notes as “no longer legal tender”.

The move had wreaked havoc on daily wagers who couldn’t get paid, shutting down economic activity. Modi had also decided to send India into a lockdown from March 25 to May 31, 2020 at a time when Covid cases hadn’t spiked, a move virologists say was unwarranted.

It once again abruptly ended economic activities, forcing migrant labourers to march home on foot for thousands of kilometres, causing deaths from starvation and exhaustion.

The much-more devastating second wave of Covid forced a lockdown in several states from April to June, 2021 as the unorganised sector felt the pinch again.

Promised jobs not delivered?

PM Modi rode to power in the 2014 general elections at least partly because of the promise of creating two crore jobs yearly but has been facing flak over unemployment in recent times.

Observers hold joblessness as one of the reasons as to why Modi didn’t return to power with a simple majority earlier this year.

The PM, however, declared that 80 million jobs were created in the last four years. Backing Modi, a Reserve Bank of India (RBI) report notes that employment rates doubled in the last financial year, a claim vehemently denied by private surveys.

The RBI report noted there had been 643.3 million employed people in March 2024 up from 596.7 million in the same month last year, an increase of 46.7 million. It credited the farm sector with creating 18.5 million jobs and the construction sector with 4.8 million.

However, economists argue that not all of these were jobs since the report included farm labour, self-employment and unpaid family work.

Unemployment rate 8%: CMIE

A private report from Centre for Monitoring Indian Economy (CMIE) held that unemployment had risen to eight per cent in the 2023-24 fiscal compared to 7.5 per cent and 7.7 per cent in the last two financial years.

Meanwhile, a Citibank assessment from June suggested that even a seven per cent would create only eight to nine million jobs as opposed to the 11 to 12 million that is required.

The Labour Department on the other hand claimed that 20 million jobs were created yearly between 2017-18 and 2021-22.