Recent data from the Periodic Labour Force Survey (PLFS) of 2022-23 has revealed positive trends in the Indian labour market, with unemployment rates falling and labour force participation rates (LFPRs) rising. However, while these numbers indicate a strengthening economy, it is essential to closely examine the condition of earnings in order to get a comprehensive understanding of the overall situation. This article delves into the data provided by the PLFS, highlighting the significance, features, objectives, effects, and potential pros and cons of the findings.
Significance
The PLFS data sheds light on the changing dynamics of the Indian labour market, particularly in terms of rural women’s participation and earnings. The significant increase in LFPRs for rural women is seen as a positive outcome, reflecting a shift towards greater inclusivity in the workforce. Analyzing the data is important to assess the impact of various factors and policies on the earning potential of different cohorts.
Features
According to the PLFS data, there has been a notable rise in self-employment for women, especially in rural areas. Unfortunately, this increase in employment seems to come at the cost of suitable working conditions, particularly for women. Additionally, while there has been an increase in wages and earnings, high inflation rates have eroded the real earnings, impacting the purchasing power of workers.
Objectives
The primary objective of this analysis is to understand the changing trends in earnings for different segments of the workforce over the period of April-June 2019 to April-June 2023. By examining the data for regular wage workers, casual workers, and the self-employed, we can assess the impact of inflation on earnings and identify any disparities between urban and rural sectors.
Effects
The findings demonstrate that only casual workers witnessed a net increase in their average real monthly earnings between 2019 and 2023. While women casual workers experienced a 13% increase in earnings, inflation led to a reduction in real earnings for most other cohorts. The impact of inflation was especially prevalent among rural women in self-employment, whose average monthly real gross earnings decreased by 7.72%.
Pros and Cons
Pros:
– The data indicates a significant increase in LFPRs for rural women, suggesting improved opportunities for economic empowerment.
– Women in regular wage work in rural areas experienced a substantial increase in earnings, reflecting progress in bridging the gender pay gap.
– Urban and rural self-employed men enjoyed gains in real earnings, indicating potential entrepreneurial opportunities.
Cons:
– The rise in self-employment for women has resulted in lower earnings and increased vulnerability to poor working conditions.
– Wage workers, both casual and regular, witnessed limited gains in real earnings, indicating a potential decline in the share of wages compared to output.
Fun Fact
Did you know that rural women in regular wage employment experienced a remarkable 27.5% increase in monthly real earnings in the quarter of April-June 2023 compared to April-June 2019? While they make up only 8% of the rural female workforce, this growth highlights the potential for progress in narrowing income disparities.
Rahul Menon is Associate Professor, Jindal School of Government and Public Policy, O.P. Jindal Global University
Mutiple Choice Questions
1. What is the main focus of the provided information?
a) The rise in unemployment rates in the Indian economy
b) The increase in labour force participation rates for rural women in India
c) The decrease in suitable working conditions for women in India
d) The impact of inflation on earnings in India
Explanation: The main focus of the provided information is the impact of inflation on earnings in India. It discusses the changes in real earnings for different cohorts of workers and highlights the effects of inflation on purchasing power.
2. According to the data, which cohort experienced the highest growth in real earnings between 2019 and 2023?
a) Rural women in self-employment
b) Urban men in regular wage employment
c) Rural women in regular wage employment
d) Urban women in casual work
Explanation: The cohort that experienced the highest growth in real earnings between 2019 and 2023 is rural women in regular wage employment. Their monthly real earnings were 27.5% higher in the quarter of April-June 2023 compared to April-June 2019.
3. Which cohort saw a decrease in real earnings between 2019 and 2023?
a) Urban men in self-employment
b) Rural men in casual work
c) Urban women in regular wage employment
d) Rural women in self-employment
Explanation: The cohort that saw a decrease in real earnings between 2019 and 2023 is rural women in self-employment. Their average monthly real gross earnings reduced by 7.72%, the largest reduction for any cohort.
4. What is the main concern associated with the increase in employment for women?
a) Lack of suitable working conditions
b) Decrease in labour force participation rates
c) Rise in unemployment rates
d) Inflation outpacing earnings growth
Explanation: The main concern associated with the increase in employment for women is the lack of suitable working conditions. The information mentions that much of the new employment generated for women has been in self-employment, which may not provide suitable working conditions.
5. In the year 2023, which cohort saw the highest growth in real earnings compared to 2019?
a) Urban women in casual work
b) Rural men in self-employment
c) Urban men in regular wage employment
d) Rural women in regular wage employment
Explanation: The cohort that saw the highest growth in real earnings in the year 2023 compared to 2019 is rural women in regular wage employment. Their monthly real earnings were 35.5% higher in the quarter of April-June 2023 compared to April-June 2019.
6. Which cohort experienced a decrease in real earnings in urban areas?
a) Urban men in self-employment
b) Urban women in casual work
c) Urban men in regular wage employment
d) Urban women in regular wage employment
Explanation: The cohort that experienced a decrease in real earnings in urban areas is urban women in regular wage employment. Their real incomes in 2023 were 2.34% lesser than in 2019.
7. What is the overall trend in real earnings between 2022 and 2023?
a) A widespread decrease in real earnings for all cohorts
b) Significant increase in real earnings for all cohorts
c) Mixed trends with some cohorts experiencing growth and others experiencing a decrease
d) No significant change in real earnings for any cohort
Explanation: The overall trend in real earnings between 2022 and 2023 is mixed, with some cohorts experiencing growth and others experiencing a decrease. Self-employed men enjoyed significant gains, while wage workers (both casual and regular) did not see extensive gains. Urban women casual workers were the only cohort that saw a decrease in real earnings.
8. What does the information suggest about India’s recovery from the pandemic?
a) India is experiencing a robust recovery with widespread income growth.
b) India is experiencing a K-shaped recovery with uneven income growth among different cohorts.
c) India is experiencing a slow recovery with declining income rates.
d) India’s recovery is yet to be determined based on the data provided.
Explanation: The information suggests that India is experiencing a K-shaped recovery with uneven income growth among different cohorts. While some cohorts saw an increase in real earnings, wage workers as a whole did not see extensive gains, indicating a reduction in the share of wages.
Note: The explanations provided are based on the given information and may vary depending on the context.
Brief Summary | UPSC – IAS
Recent data from the Periodic Labour Force Survey (PLFS) of 2022-23 shows positive trends in India’s labor market, with falling unemployment rates and rising labor force participation rates for rural women. However, there are concerns about the quality of employment, as much of the new jobs for women are in self-employment and unpaid family help. In terms of earnings, only casual workers saw a net increase in their average real monthly earnings. Women casual workers experienced a 13% increase, while male casual workers enjoyed a 10.33% increase. Most workers experienced lesser real earnings due to high inflation. Overall, the data suggests a K-shaped recovery with slower wage growth compared to output.
