SBI Report Highlights India's Labour Market Shift In Structure

India's labour market evolution emphasises self-entrepreneurship and education's pivotal role, countered by misconceptions about unemployment, says an SBI study. The report clarifies misinterpretations around the Periodic Labor Force Survey (PLFS) data, highlighting a decline in unemployment rates over five years and the surge in self-employment and youth unemployment.

PLFS findings for FY18 to FY23 reveal a substantial drop in unemployment from 6.1 per cent to 3.2 per cent. Female labour participation increased notably, led by Odisha, Himachal Pradesh and Uttarakhand. Presently, female participation stands at 32 per cent, compared to 28 per cent in 2019-2020.

States like Himachal Pradesh and Meghalaya boast high ratios of female participation, challenging the narrative on shrinking employment opportunities. The report advocates augmenting banking correspondents' representation to 33 per cent, aiming for a meaningful socio-economic shift.

Contrary to the belief that the rise in self-employment, particularly in household help, signals job scarcity, the report asserts that self-employment has historically exceeded 50 per cent. It credits government initiatives like Pradhan Mantri Mudra Yojana and PM-SVANidhi for catalysing labour market transformations.

The study suggests recalibrating PLFS benchmarks for educational qualifications, recognising education's impact on unemployment rates. It highlights a noticeable drop in unemployment among those with secondary education or higher in the past three years.

PLFS, initiated in 2017, aimed to address limitations of previous surveys. It provides detailed unemployment rates at national and state levels across rural and urban sectors, considering various demographics.

Overall, the report highlights the evolving labor landscape, emphasising self-entrepreneurship, educational significance and the need for nuanced interpretations of employment data.