The 8.8 million increase in the labor force in April comes after a 12 million fall in the labor market in the last three months when labor left the labor market between January and March.
However, employment increased by 7 million in April 2022, which was higher than the previous months but was insufficient to absorb the sudden increase in job demand.
CMIE said in its weekly labor market analysis, “This also comes after an unusually large increase and three consecutive months of job losses.”
Employment fell 106 million from 406 million in December 2021 to 396 million in March 2022. In April, it recovered a fraction of this fall, reaching 403 million.
Unemployment rose by 1.8 million a month as a result of high labor force growth and inadequate employment opportunities, pushing the total number of unemployed to 34.2 million.
“As a result, the number of unemployed people increased in April and the unemployment rate rose slightly compared to March levels,” CMIE said in its weekly labor market analysis.
According to CMIE, the unemployment rate in April was 7.83% compared to 7.57% in March.
According to CMIE, employment in the industrial and services sectors increased in April. While the industry added 5.5 million jobs, services added another 6.7 million jobs in April. However, the closure of Rabi season and decline in wheat production has created 5.2 million jobs in agriculture.
Within the industry, 3 million jobs have been added to manufacturing and about 4 million have been added to construction. Mines and utilities, however, have reported sharp declines in employment, possibly due to coal shortages and consequent pressures on India’s power sector.
The increase in employment in industry and services, however, did not lead to good quality jobs. According to the CMIE, employment growth was mainly among daily wage workers and small traders when there was almost no change in wage employment.