Halfway through the year, both growth and employment remain on a sticky wicket. While the IMF has recently downgraded India’s growth outlook from 12.5% to 9.5% for this year fiscal 2021-22, deep damage appears to be visible on unemployment.

In conversation with Mitali Mukherjee, CMIE’s Mahesh Vyas pointed out that in the last seven years, the government has been unable to collect unemployment data – it was best they gave up the attempt and engaged with the private sector data that is available, to work on employment solutions instead of criticising the data.

Vyas pointed to the dipping labour participation rate. It stood at 40% in May and fell to 39.6% in June and said that by 2022, there will be three batches of graduates amongst the youth hitting a labour market where investments are poor. Wages are going to be further depressed and the labour participation rate may fall even further.

The worst problem for India’s demographic dividend has been the decimation of employment opportunities for women. CMIE’s estimate of female labour participation is as low as 10 to 11%, while PLFS says it has increased from 24.5% in 2018-19 to 30% in 2019-20.

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