COVID-19 Second Wave Left 34 Lakh Salaried Indians Jobless in April: CMIE Report

Salaried Indians continue to remain a worrying casualty of the cessation of economic activities, in continuation of a trend recorded during last year’s nationwide lockdown, as a resurgence in COVID-19 cases sends the economy spiralling anew in the country.

Latest monthly data for April, when the impact of the second wave of the virus was felt, shows that 34 lakh salaried jobs in the country were lost as national unemployment rate soared to a four-month high of 7.97%.

Around 28.4 lakh salaried jobs were lost in the rural areas and 5.6 lakh in the cities, The Telegraph reported on May 10, quoting figures published by the Centre for Monitoring Indian Economy (CMIE), a Mumbai-based think tank. The erasure in jobs thus resulted in reduction of number of salaried Indian employees from 4.6 crore in March to 4.544 crore in April, the report added.

More worryingly, the devastating effects of the second wave of the pandemic on the salaried workforce is double than last year, suggesting that the plight of this section has only worsened. 

Over 17 million salaried jobs were erased, according to the CMIE data for the corresponding period (April) a year ago. By the end of August last year, this estimation of salaried job losses had reached 21 million.

Following a countrywide lockdown in March last year, there were about 121 million people in total who were rendered freshly unemployed in the immediately following months – April and May. In comparison, over 7.5 million jobs have been lost in April this year.

Last year, the labour market conditions reportedly improved later, following an ease in restriction movements albeit, largely in the informal sector. The trend had thus invited the economists to claim it as an “unhealthy recovery”.

The State of Working India 2021 report, recently released by the Azim Premji University, also confirms this trajectory, claiming that last year post lockdown there was a “large increase” in informal employment.

“After the lockdown, workers came back into more precarious and informal forms of employment. Nearly half of formal salaried workers moved into informal work, either as self-employed (30%), casual wage (10%) or informal salaried (9%) workers, between 2019 and late 2020,” the report says.

Also read: Over 7.5 Million Jobs Lost in April: Experts Call for Fresh Relief Package for Marginalised

Experts now fear of an additional strain especially on the small and medium enterprises in the country as the recent surge in COVID-19 cases caused another shock to them, even as the economy was not fully recovered from the last year’s breakdown.

“… the 34 lakh who lost their salaried jobs are in a deeper crisis. They worked in small and medium industries that have closed their operations. Many of these units are unlikely to revive amid the economic slowdown,” The Telegraph quoted labour economist Santosh Mehrotra as saying in the same report.

Moreover, the State of Working India 2021 report claims that the number of individuals earning below the national minimum wage threshold, Rs 375 per day as recommended by the Anoop Satpathy committee, increased by 230 million during the pandemic last year. 

Resultantly, households cut back on their food intake and were largely left to borrow money from informal means, according to the Azim Premji University report. It is feared that a similar, if not worse, situation will grip the country’s working masses yet again this time around.

Sensing the same, demands to provide an income and food ration support have once again come to the fore. Last month, the Central Trade Unions wrote to Prime Minister Narendra Modi reiterating that the Centre must provide Rs 7,500 per month to all non-income tax paying families along with a 10 kg of free monthly ration to each needy person for the next 6 months.

Similarly, economists are also urging the Centre increase government spending towards building public infrastructure and employment generation.

A number of states in the country including Delhi, Maharashtra, Karnataka, Haryana, Uttar Pradesh, Madhya Pradesh among others have currently imposed shutdown measures, even as no nationwide lockdown has been announced as yet.