India’s unemployment rate fell to a four-month low of 5.1 per cent in July from 5.5 per cent in June, as the labour force participation rate (LFPR) rose, suggesting a firming labour market, according to the latest monthly bulletin of the Periodic Labour Force Survey (PLFS), released by the National Statistics Office (NSO) on Monday.
LFPR, which is the percentage of the population that is either working or actively looking for work, also rose to a four-month high of 55.4 per cent in July, up from 54.4 per cent in June. This was its first increase after slipping between March and May and holding steady in June.
LFPR in rural areas climbed to 58 per cent during the month from 56.6 per cent in June, while in urban areas it edged up to 50.4 per cent from 50.1 per cent.
The worker population ratio (WPR), which represents the number of persons/person-days employed per 1,000 persons/person-days, rose to 52.5 per cent during the month from 51.4 per cent in June — the first increase in the indicator since February.
WPR in rural and urban areas rose in July, reaching 55.4 per cent and 47 per cent, respectively, from 53.8 per cent and 46.8 per cent in the previous month.
Overall, the male and female worker population ratios also improved during the month, reaching 73.3 per cent and 32.5 per cent, respectively, from 72.9 per cent and 30.8 per cent in June. The rural female WPR rose sharply to a four-month high of 37.2 per cent from 34.7 per cent.
The NSO pegged the urban unemployment rate in July, in terms of the current weekly status (CWS), at 6.7 per cent, broadly steady from the 6.6 per cent recorded in June. For rural areas, the jobless rate fell to 4.5 per cent in July from 5 per cent in the preceding month.
Under the CWS approach, activity status is determined based on the reference period of the seven days preceding the date of the survey. A person is considered unemployed if they did not work even for one hour on any day during the reference week but sought work or were available for work for at least one hour on any day during the reference week.
The overall unemployment rate among men declined to 5 per cent in July from 5.3 per cent in June. Similarly, the female unemployment rate fell to 5.4 per cent in July from 5.9 per cent in the preceding month.
The sampling methodology of PLFS was revamped in January last year to estimate key employment and unemployment indicators monthly for rural and urban areas using the CWS method at the all-India level.
