Unpaid Labour on the Rise in India, as Unemployment Reaches 6-Year Low

The data reveals a disturbing increase in the prevalence of unpaid labour and stagnation in the number of individuals in regular wage-paying jobs. 

Srajan Girdonia
New Update
Indian Labour Market.jpg

In a mixed bag of employment statistics, India has witnessed a decline in its official unemployment rate, which has reached a six-year low. However, this seemingly positive news hides underlying issues highlighted in the results of the Periodic Labour Force Survey (PLFS) for the period of July 2022 to June 2023.

The data reveals a disturbing increase in the prevalence of unpaid labour and stagnation in the number of individuals in regular wage-paying jobs. 

Moreover, the Muslim population, already grappling with various forms of discrimination, faces a decline in workforce participation, which raises significant concerns. This article explores the implications of these trends and the steps that need to be taken to address these pressing issues.

Unemployment Dips as Unpaid Labour Rises

While the official unemployment rate in India has decreased from 7.5% in July 2021 to 6.4% in June 2023, this apparent improvement is not entirely due to a surge in regular wage-paying jobs. Instead, the decrease in the unemployment rate can be attributed to the substantial increase in self-employment and unpaid labour.

The surge in unpaid labour is a matter of deep concern. Unpaid labourers, often found in informal and unregulated sectors, are susceptible to exploitation and abuse. They typically lack access to social security benefits and work in precarious conditions. .

The PLFS data underscores that the number of individuals engaged in conventional employment remains stagnant, pointing to a need for policies that promote the creation of sustainable job opportunities.

Number of People in Regular Wage-Paying Jobs Remains Stagnant

The PLFS data highlights a critical issue that policymakers must address: the lack of growth in regular wage-paying jobs. A stagnant workforce in these positions implies limited access to job security, benefits, and a stable income.

To foster economic growth and social security, it is imperative that the government takes measures to stimulate the creation of regular employment opportunities across various sectors.

Share of Muslims in Workforce Declines

A concerning trend brought to light by the PLFS data is the decline in the share of Muslims in the Indian workforce. This minority group, which already faces discrimination and disparities in various aspects of life, has witnessed a reduction in workforce participation from 13.4% in July 2021 to 12.6% in June 2023. This dip to the lowest level since the PLFS began in 2017 is disquieting, as it can exacerbate the marginalisation of the Muslim community.

The decline in the workforce participation of Muslims in India is a distressing development. The Muslim minority faces systemic discrimination in various aspects of life, and this decline may further marginalised them.

To combat this issue, it is essential to implement policies that promote diversity and inclusion in the workforce, along with addressing the underlying factors that contribute to this decline.

Government Needs to Take Steps to Address These Issues

To rectify the burgeoning problem of unpaid labour and declining Muslim workforce participation, the government must take proactive measures:

1. Promote Job Creation: The government should actively encourage the creation of regular wage-paying jobs by providing incentives to businesses and startups, investing in skill development programs, and fostering economic growth.

2. Protect Unpaid Labourers: Legislative measures and regulations should be put in place to safeguard the rights of unpaid labourers. These measures should include ensuring minimum wage standards, providing access to social security benefits, and addressing issues of exploitation and abuse.

3. Combat Discrimination: Anti-discrimination policies and measures should be enforced to ensure equal opportunities for all segments of the population, including religious minorities. Promoting diversity and inclusion in workplaces is crucial for a fair and just society.

4. Enhance Access to Education and Training: To address the underlying causes of unemployment and workforce decline, the government should invest in improving access to education and vocational training, especially for marginalised communities.

The PLFS data has unveiled critical challenges within the Indian job market. A decrease in the unemployment rate, while encouraging, is primarily attributed to an increase in unpaid labour rather than the creation of regular wage-paying jobs.

Simultaneously, the decline in the share of Muslims in the workforce raises concerns about further marginalisation. To tackle these issues, the government must prioritise job creation, protect unpaid labourers, combat discrimination, and invest in education and training.

Addressing these challenges is essential to ensure a more inclusive and equitable workforce for India's diverse population.