New Delhi: In an indication that the global layoff wave has hit the Indian shores, global financial services major Citigroup believes that jobless numbers in the country could climb in the coming months.
According to a latest report by Citigroup, the country does not appear to have remain unscathed from the massive layoffs witnessed worldwide and unemployment could rise further with home coming of migrant workers.
“The pressure on employment, confidence and price levels would be more burdensome than in the past. Moreover, India could be impacted by the return of migrant workers or declining remittances,” Citi India economist Rohini Malkani said in the report.
Citi further said the ministry of labour has indicated that over 500,000 jobs were lost during October-December 2008, with export-oriented sectors such as gems and jewellery, autos, and textiles being most impacted.
However, the report stated this statistic only covers the organized sector, which comprises just 10% of the country’s workforce of close to 385 million.
The report also said with elections round the corner, job security could be one of the key election issues.
India’s unemployment rate is officially at 8.2% but the point worth noticing is that disguised employment exists in developing economies, it added.
On a sectoral basis, more than half the workforce continues to depend on agriculture, although it accounts for just 18% of the gross domestic product.
“While this has been on the downtrend, it has resulted in widening income gaps,” Malkani said.
Depicting the deteriorating economic conditions globally, the latest US jobs data showed more than 500,000 job losses for the third consecutive month resulted in the unemployment rate to rise to 7.6%.
Besides, the International Labour Organization has predicted that global unemployment could rise in a range of 18-50 million workers.