Just ahead of the state assembly elections in five states scheduled for this month, the central government received concerning news. Private research firm CMIE claims that unemployment in India reached its highest level in two years in October 2023. Rural areas of the country have seen a significant increase in unemployment, impacting the overall unemployment rate.
The Center for Monitoring Indian Economy Limited, as reported in the Business Standard, revealed that the unemployment rate in October rose to 10.05%, up from around 7.09% in September 2023.
Notably, this is the highest unemployment rate since May 2021, with rural areas witnessing an increase from 6.20% to 10.82%. In contrast, urban areas saw a decline to 8.44% due to the emergence of new job opportunities.
The Impact of Monsoon
This year, the unpredictable behavior of the monsoon adversely affected various crops such as sugar, rice, and wheat. In response, the government imposed several restrictions to control prices. The low agricultural output in rural areas affected agricultural activities. However, urban areas experienced a boost in manufacturing and construction activities, resulting in increased job opportunities.
Worrying News for the Government
With state assembly elections taking place in Chhattisgarh, Madhya Pradesh, Rajasthan, Telangana, and Mizoram this month, these unemployment figures could be a significant concern for the government. Experts predict that India’s GDP is likely to grow at a rate of 6%, but the creation of new jobs for young people has not kept pace. The issue of unemployment has been a long-standing challenge in the country, and this data from CMIE underscores the urgency of addressing this problem.