Have the labour markets recovered post-lockdown?
The forthcoming Union Budget will be presented in the backdrop of the largest ever contraction – the National Statistical Office (NSO) expects this number to be 7.7% in 2020-21 – in the Indian economy. To be sure, the NSO believes that the economy is out of contraction zone after a decline of 23.9% and 7.5% in the quarters ending June and September 2020. Several high-frequency indicators such as the Nomura India Business Resumption Index (NIBRI), Purchasing Managers’ Indices (PMI) show a strong sequential recovery in the economy. Such indicators, however, do not tell us about the pandemic’s impact on the labour market and incomes, and whether the situation has improved with removal of lockdown restrictions.
Because high-frequency, nationally representative data is not available officially, private surveys have to be relied on to answer this.
Even such an exercise has to be mindful of the average impact on the labour market and the situation of those at the bottom of the pyramid. In a two-part series, researchers and faculty members of the Azim Premji University (APU) try to answer this question by analysing two surveys.
The first is based on the nationally representative Consumer Pyramids Household Survey (CPHS) data from the Centre for Monitoring Indian Economy (CMIE). CPHS is a high-frequency panel survey of 174,405 households with every household being interviewed thrice a year. The second part will rely on a survey conducted by APU, which, although not representative, is a better sample of the most vulnerable workers in the Indian economy.