Covid-19 has created a lot more trouble for jobseekers in India than any other pandemic ever did. As the country has seen the highest-daily new cases and deaths during the first week of May, the government imposed strict lockdown in most of the states.
This has a direct impact on businesses, and the reciprocal effects has forced companies to trim down their operations as well as job opportunities for hundreds of thousands of people out there.
The unemployment rate in India touched double-digit once again in May 2021. According to the Centre for Monitoring Indian Economy (CMIE), the unemployment rate shot up from 14.5% in the week ended May 16 to 14.7% in the last week ended May 23.
The last time the unemployment rate stumbled into double-digits was between March and May 2020 when the complete lockdown was imposed due to Covid-19 pandemic. In fact, in May 3, 2020, the India’s unemployment rate reached an all-time high of 27.11%.
The CMIE data also reveals that the unemployment rate has been rising in both, rural and urban areas. The urban India unemployment rate is much higher than the rural. At 10.72%, Urban India recorded the double-digit unemployment rate for the first time in the week ended April 18, 2021. Surprisingly, this has increased to 17.41% in the week ended May 23, 2021. On the other hand, rural India’s unemployment rate declined from 14.34% in the week ended May 16 to 13.52% in the week ended May 23.
What makes it more concerning that situation is not expected to improve anytime soon. The fall in employment in India may even worse by the end of this month. The employment rate fell from 37.6% in March 2021 to 36.8% in April. About 7.4 million jobs were lost in April month. On May 23, 2021, the 30-day moving average employment rate recorded was 35.8%.
Apart from the Covid-19 pandemic, there is one more reason behind this disappointing employment scenario in India. According to a report prepared by HAN Digital, a whopping 1 million employees will potentially resign this year. Indian IT companies are likely to face sharper attrition rates in 2021 mainly due to the increasing demand for talent.
Given the tough condition in India, companies have halted their expansion plans for now. Many MNCs which shifted to India last year due to the rising concerns and fear of Covid19 in China are also re-evaluating their decision amid the reports painting tough market conditions for years to come mainly to the long-lasting impact of Covid19 in India. As many experts fear of 3rd wave of Covid19 in India and showing deep concerns about the slow vaccination process, companies have already started preparing itself to deal with market conditions that could arise again due to that. Halting their expansion plans, going slow on hiring new talents and shifting base or part-operations to neighbouring countries are one of those strategies being evaluated.
All said and done, tough days are ahead for job seekers. The increasing unemployment in India once again brings back the horrific memories from the last year. By putting effective strategies in place the government must reduce the impact – if can’t be avoided completely – of Covid19 on people and their employment opportunities.