Salaried jobs lost: 10 million & counting

million salaried jobs are gone,” Vyas said.”> “The stress is largely on salaried employees because it is harder for them to re-skill and find new jobs. A draughtsman today can’t become an agricultural worker tomorrow. And we are saying about 10 million salaried jobs are gone,” Vyas said.

While the net number of jobs lost post the pandemic stood at about 5.5 million at March-end compared with the average in 2019-20, the number of salaried jobs lost is a staggering 10 million. According to Mahesh Vyas, CEO & MD, CMIE, 60% of these 10 million jobs were lost in the rural sector where workers have been hit because MSMEs and other industrial units are in trouble.

In the absence of opportunities in companies and small establishments, there has been a shift of the labour force to the agriculture space, creating a fair bit of disguised unemployment. In some senses, this is the reverse of the trend seen when the economy was liberalised and people moved from farms into factories.

However, with half the factories in Maharashtra either shut, or on the verge of shutting down, the strain on urban India is now intensifying, Vyas told FE, adding we could see more livelihoods lost as states enforce more restrictions. CMIE’s 30-day moving average unemployment measure, which is drawn from a fairly large sample, indicates joblessness which was 7% on April 11, has gone up to 7.4%, a fairly swift uptick in a short time.

Vyas estimates that overall there has been a 20% loss of household income saying it’s unlikely there would have been any improvement in rural wages since the data was announced in October last year.

While most workers in the informal sector will soon find work, since they cannot afford to be sitting idle, they would probably continue to suffer a loss of income. “The stress is largely on salaried employees because it is harder for them to re-skill and find new jobs. A draughtsman today can’t become an agricultural worker tomorrow. And we are saying about 10 million salaried jobs are gone,” Vyas said.

He expressed concern that many of the government’s investment schemes were capital-intensive and benefitting foreign companies. “It is important for us to create fruitful employment and I don’t think we are doing that as yet. There is a serious loss of good quality, salaried jobs,” he said. Vyas believes there is huge under-staffing in several government departments — health and police for instance– and that government should step up hiring to be able to deliver these services more efficiently to citizens.

With daily wage earners forced to stay at home, an estimated 120 million jobs were lost post the pandemic — compared with the loss of three million livelihoods post demonetisation—-and most of these were in the informal sector. While most of these have been recovered, only once, in January, has the employment number bounced back to 400 million.

The other worrying trend is that whenever there is an economic shock women are seen to leave the labour market. One reason for this is that employers could be discriminating against women. The female participation rate has been falling while the government’s Periodic Labour Force Surveys show the rate at 22%, CMIE’s data estimate this to be 10%.