cmie: Outbreak of pandemic led to an increase in number of households with no earning members: CMIE

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The outbreak of pandemic has led to an increase in the number of households with no earning members making them more vulnerable to the pandemic, the Centre for Monitoring Indian Economy said.

On an average 7.8% of the households did not report any member as employed from July through November 2021, after the second Covid wave, compared to 6% before the pandemic, CMIE said.

This proportion, though, had risen to 11.5% in 2020 with the peak in April at 33% during the nationwide lockdown, 25% in May 2020 and 12% in June 2020.

According to CMIE, while the proportion of households where more than one person is employed has fallen relentlessly from nearly 35% in 2016 to about 24% in 2021, households where only one person is employed has risen from 59% in 2016 to 68% in the first 11 months of 2021.

“Households with only one employed person can be considered to be somewhat vulnerable. Their proportion is rising. Also, the proportion of highly vulnerable households with no person employed is rising,” it said in its weekly labour market analysis.

CMIE further said that the fall in the labour participation rate since 2016 has been accompanied with a fall in the proportion of households where more than one person is employed. Evidently, the fall in labour participation rate has largely been the result of the additional person employed in a typical household losing a job.

Data from CMIE shows that the proportion of households where more than one person is employed has fallen from 34.7% in 2016 to 32.3% in 2017 to 30.1% in 2018 and to 28.4% In 2019.

In 2020, the average proportion of households with more than one employed person fell to 24.2%. But, in April 2020 when the country was under lockdown, the proportion was down to 17.6% though it had risen to 24% in the first 11 months of 2021.

According to CMIE, for survival, a household requires that at least one of its members should be working. But, it is not similarly necessary for more than one member to be employed. “Hence the high unemployment rate and falling labour force participation rate in India.

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