Chennai: The unemployment rate in India declined to a multi-year low in September after touching an yearly high in August.
As per the data of think-tank Centre for Monitoring Indian Economy, the jobless rate sharply fell to 6.43 per cent, the lowest in many years. However, in the previous month, the unemployment rate had touched 8.28 per cent, which was the highest since October 2021.
In August several workers had entered the labour market, but were not able to find job. This pushed the unemployment rate from 6.83 per cent in July to 8.28 per cent in August. "The labour participation rate went up in August. However, the economy was not able to absorb the increased labour in the market. Hence, we saw the unemployment rate going up," said Mahesh Vyas, founder of CMIE.
According to him, the labour participation rate further went up in September. Nearly 10 million jobs were added during the month. As jobs were created in September, the unemployment rate was seen coming down. "September has just ended. We have to get more data on employment," he said.
In rural areas, the unemployment rate declined to 5.84 per cent from 7.68 per cent in August, while in urban areas it stood at 7.7 per cent in September, lower than 9.57 per cent in the previous month.
Festive season hiring had started in September and this was evident in at least some sectors like retail and trade. The festive season typically boosts economic activity and aids jobs growth. A clearer picture of festive season hiring would be visible in the October data. In September, rural areas too have added a significant number of jobs. Sowing of kharif crops picked up.