Over 21% YoY Drop In Work Demand Under MGNREGS In July

Amid ample rainfall and strong economic activity, the work demand under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) dropped for the ninth straight month in July. According to the preliminary data from the Rural Development Ministry, the work demand fell by 21.6 per cent on a year-on-year (YoY) basis in July as about 22.8 million individuals demanded work during the month.

The Centre’s flagship programme guaranteeing rural jobs usually witnesses contractions in work demand when there are alternate employment opportunities which are better paying. The monsoon showers also play a crucial role in the work demand as ample rainfall during the month causes unskilled workers to migrate to agriculture.

The individuals demanding work in July represented 18.9 million households, which is down by 19.5 per cent as compared to the figures a year ago. Talking about month-on-month (MoM) basis, the number is 28.4 per cent lower as compared with June.

As far as the monsoon is concerned, the country received rainfall at 109 per cent of the long period average (LPA) in July, after an inadequate and uneven rainfall in June. The Indian Meteorological Department (IMD) forecast anticipates the development of la-lina conditions by the end of August. Last year in July, the erratic rains led to healthy work demand under the MGNREGS.

The monsoon in July reduced the demand for unskilled work, as the workers migrated to agriculture. This is seen in the increase in area sown under Kharif crops which increased by 2.3 per cent on a YoY basis as of 26 July 2024.

The strong economy also led to a contraction in demand. The country’s economy grew at an 8.2 per cent rate in the previous fiscal. The forecast by the International Monetary Fund (IMF) for the current year is also on the positive front. The range of growth is expected to be between 6.5 per cent and 7 per cent.