A day after the Narendra Modi government took oath of office for its second term, the National Statistical Office (NSO) on Friday formally released the leaked annual Periodic Labour Force Survey (PLFS), which showed unemployment rate at 6.1% in 2017-18. However, NSO held that the unemployment rate is not comparable with previous similar surveys as PLFS sample emphasizes on level of education in a household where at least one person should have studied secondary education or above while the earlier employment surveys were based on monthly per capita expenditure.
“The rationale for this decision was based on the fact that the education levels in the economy have risen due to various policy interventions like the Right to Education Act etc and it would be important to assess the level of employment and unemployment using this as a stratification basis. This has been incorporated in the sampling design of PLFS, where out of 8 households selected in the sample, 75% had at least one member with 10th standard or above," a statement by NSO said.
PLFS was launched with the objective to measure labour force participation and employment status in the short time interval of three months for urban areas and both for rural and urban areas on annual basis. The quarterly survey captures only Current Weekly Status (CWS) while the annual survey measures both usual status and CWS.
India’s unemployment rate in the urban area as measured by the Current Weekly Status (CWS), which was released for the first time along with the annual report, rose by 10 basis points in October-December quarter last year to 9.7% after dipping by equal measure in the previous quarter.
NSO said the change in criteria from monthly per capita expenditure to education levels has direct implications on the comparability of the results of PLFS with the Employment Unemployment Survey of earlier years. “In view of this, the PLFS needs to be seen as a new series for measuring employment and unemployment on an annual basis," it added.
Explaining rather high unemployment level of 6.1%, NSO said with the rise in education levels in the economy and rise in household income levels, the aspiration levels of educated youth have also risen. Thus they may no longer be willing to join the labour force or work force requiring low skills and low remuneration. "The PLFS results give a distribution of educated employed and unemployed youth across the country, which can be used as a basis for skilling of youth to make them more employable by industry," it added.