Bhupender Yadav, Union Labour Minister (Photo: AP)
We now have data provided by the Periodic Labour Force Survey (PLFS) every quarter. Can it be said that we now have sufficient data on employment in the formal sector?
The major data source of employment and unemployment indicators in India at present is PLFS, conducted by the Ministry of Statistics and Programme Implementation (MoSPI) since 2017-18. The annual PLFS reports for the years 2017-18, 2018-19, 2019-20 and 2020-21 are available in the public domain. Prior to PLFS, before 2017-18, the National Statistical Office (NSO), MoSPI, used to conduct quinquennial employment and unemployment surveys. The last such survey was done in 2011-12.
The quarterly PLFS reports are released for the urban sector only. Moreover, the quarterly PLFS report does not provide separate estimates for formal-informal employment. The annual estimates of different labour force indicators are released for both rural as well as urban areas at the state, Union territory and all-India levels. The annual report of PLFS specifically provides information about “percentage of workers engaged in proprietary and partnership (P&P) enterprises among workers (ps+ss) engaged in non-agriculture sector” in the informal sector. The latest data of PLFS 2020-21 indicates that this stands at 71.4 per cent for combined rural and urban areas. It has risen since 2017-18.
The Quarterly Employment Survey (QES), conducted by the Labour Bureau, aims to assess the employment situation in respect of selected nine sectors of the non-farm economy of India over successive quarters. These are manufacturing, construction, trade, transport, education, health, accommodation and restaurants, information technology (IT)/ business process outsourcing (BPO) and financial services. QES is limited only to establishments having 10 or more persons (organised segment) as identified by the Sixth Economic Census (2013-14). As per the last Economic Census (2013-14), 1.37 per cent enterprises employed 10 or more workers.
The estimated total employment in the nine selected sectors from the first round of QES (April to June 2021) was 3.08 crore approximately against a total of 2.37 crore in these sectors taken collectively, as reported in the Sixth Economic Census, reflecting a growth rate of 29 per cent. Further, the estimated total employment in the nine selected sectors from the fourth round of QES (January-March 2022) came out as 3.18 crore as compared to 3.14 crore from the third round of QES (October-December 2021).
The data shows Labour Force Participation Rate (LFPR) in the Current Weekly Status (CWS) at 47.5 per cent. This is seen as low in comparison to many countries. Is this because we are not adequately capturing informal sector employment?
PLFS is being conducted by MoSPI through scientifically designed survey methods with the objective to cover both informal and formal sectors. The objective of PLFS is primarily twofold.
It is to estimate key employment and unemployment indicators (worker population ratio, labour force participation rate, unemployment rate) in the short interval of three months for urban areas only in the CWS.
It also estimates employment and unemployment indicators in both usual status (ps+ss) and CWS in both rural and urban areas annually.
LFPR for persons aged 15 years and above in CWS is 47.5 per cent for the urban sector only (PLFS April-June 2022). As per the survey methodology, it is expected to cover both informal and formal sectors.
It is pertinent to mention that comparison of labour force indicators of different countries may not be in the fitness of things as it depends on the economic structure of each country, survey methodology, and procedure of collection of data which may be different.
The PLFS data also shows low participation of women in the work force. Again, is it lack of data or depressed female participation in the employment market?
The periodic labour force surveys capture information on the reasons for not being in the labour force. According to the PLFS results, the percentage distribution of men and women not being in the labour force as per the main reasons shows that out of the total women outside the labour force, around 43 per cent were so because of “Child care/personal commitments in home making” and 33.2 per cent wanted to continue their studies instead of joining the labour force. Around 4.3 per cent of women were outside the labour force due to “social reasons”.
Further, some studies indicate that most women work and contribute to the economy in one form or another, but much of their work is not documented or accounted for in official statistics, and thus women’s work tends to be underreported. However, as of 10.10.2022, out of the total registration of unorganised workers on the e-SHRAM portal on a self-declaration basis, 52.82 per cent are women.
The employment debate is as much political as it is about data. What is your response to allegations that growth has been jobless or that the government has not managed the economy well?
As per the annual PLFS report, LFPR, Worker Population Ratio (WPR) and Unemployment Rate (UR), in usual status for persons of 15 years and above, were 52.6 per cent (WPR), 54.9 per cent (LFPR) and 4.2 per cent (UR) for 2020-21. WPR and LFPR have steadily increased, UR has dipped.
The data indicates the government has been successful not only in adding more people to the labour force but also in providing more employment compared to the increase in the labour force due to which the unemployment rate has steadily declined.
The quarterly data of PLFS indicates that before the outbreak of Covid-19, the urban labour market had shown signs of improvement in terms of LFPR, WPR and UR. However, the pandemic has adversely impacted the urban labour market. In the first quarter of 2020-21, the unemployment rate for the urban sector rose to 20.8 per cent. LFPR and WPR in the urban sector also declined significantly during this quarter.
With the revival of the economy in the subsequent quarters of 2020-21, 2021-22 and 2022-23, all three labour market indicators show a swift recovery. The latest quarterly PLFS data for the quarter of April-June 2022 indicates that labour force indicators are at a better level than the pre-pandemic level. Further, the independent QES by the Labour Bureau also indicates a steady increase in employment. The estimated total employment, as discussed earlier, in nine selected sectors from the fourth round of QES (January-March 2022) came out as 3.18 crore as compared to 3.14 crore from the third round of QES (October-December 2021), indicating an increase of four lakh in employment.
How can employment in the gig economy and startups be measured?
The eShram portal of the Ministry of Labour and Employment captures the data of unorganised workers. So far, 28.32 crore workers have registered. Recently, a gig and platform module has been added. Further, all platform aggregators have been asked to get all their workers registered on eShram under the newly added module.