Measuring Unemployment

The Periodic Labour Force Survey (PLFS) for 2021-22 revealed an unemployment rate of 4.1% in India, shedding light on the complexities and nuances of measuring and understanding unemployment rates across various nations.

Unemployment Defined

What Does Unemployment Mean?

  • Criteria by International Labour Organization (ILO):
    • Currently out of a job.
    • Readily available for work.
    • Actively searching for employment.
  • Key Distinction: Not being in an active job search does not equate to being unemployed.

Understanding the Labour Force

  • Comprising of: Employed and unemployed individuals.
  • Those Not Considered: Students, individuals engaged in unpaid domestic tasks, and similar categories.

Comparative Analysis: Unemployment Statistics

  • PLFS 2017:
    • India recorded a historically high unemployment rate of 6.1%.
  • PLFS 2021-22:
    • Current rate stands at 4.1%.
  • U.S. Rates:
    • As of July 2022: 3.5%.
    • As of July 2023: 3.7%.

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Calculation and Influencing Factors

  • Determining the Unemployment Rate: It’s essentially the ratio of the unemployed population to the entire labour force.
  • Driving Forces:
    • The capacity of an economy to create jobs.
    • Individuals choosing not to seek employment.

Variances in Developed and Developing Economies

Cultural and Social Factors

  • India as a Case Study:
    • NSSO Survey 2009-10 highlighted a significant percentage of women preferring domestic roles over employment.
    • Labour Force Participation Rate (LFPR) for rural women was recorded at 26.5%. copyright©
  • Challenges:
    • Informal nature of jobs complicates accurate measurement.
    • Different methods, such as UPSS and CWS, employed by NSSO can yield varying results.

CMIE’s Method

  • Bases its metrics on the previous day’s employment status, which can potentially indicate a higher unemployment rate and a decreased LFPR.

Developing vs. Developed Nations

  • In developing countries, job regularity is less consistent compared to developed countries.

Impact of Lockdown on Employment


  • March 2020: The lockdown due to the pandemic caused significant disruptions in India’s economy.
  • PLFS Data: Covered the period up to June for both 2019-20 and 2020-21, shedding light on the lockdown’s immediate and subsequent impacts.

The Lockdown Scenario

  • Individuals with regular employment before the lockdown faced job losses in March 2020.
  • Employment statistics showed variations, with a spike during the lockdown and a reduction thereafter, particularly in urban areas as per CWS rates.

The Political Angle

  • With elections looming, there’s a heightened focus on understanding and addressing unemployment issues.


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