Wake up to the continuing distress in rural India
SummaryOverall employment has risen but we cannot deny the reality of rural distress as revealed by a closer look at data from surveys and our rural jobs guarantee scheme in their proper context
Last month, in a column in Mint, Chief Economic Advisor (CEA) V. Anantha Nageswaran along with Deeksha Bisht provided a reassessment of claims of rural distress in India. Their primary concern arose from the trends and patterns emerging from recently-released data on employment from the Periodic Labour Force Surveys (PLFS). A preliminary reading of the data of the last four years corroborates evidence from other sources of a deepening of rural distress. While overall employment has indeed increased, the sectors and population groups which have seen an increase in employment suggest that a large part of the employment growth may be distress-driven. Of the total increase in employment of 82 million between 2017-18 and 2020-21, more than 60% was among women workers, and more than half was in agriculture, reversing a trend seen since 2004-05. A break-up by age groups also indicates that a significant increase was recorded among younger age cohorts along with the elderly, who, like many women, were likely forced to move into the labour market to supplement household incomes during times of distress. Most of these indicators are showing trends and patterns which are similar to what was observed during the last period of severe distress in India’s rural economy, between 1999-00 and 2004-05. Much of this increase can be traced to self-employment, with a decline in the share of regular and wage workers, a sign of distress that is also noted by Nageswaran and Bisht.