As India’s lockdown to contain Covid-19 brings the economy to a grinding halt and businesses shut down, the latest episode of the Centre for Policy Research’s podcast looks at its impact on the unemployment rate, labour force participation, and the overall income of individuals and businesses.
The economy was still recovering from the shocks of demonetisation and Goods and Services Tax, and the lockdown has accentuated concerns around labour force participation and income levels, which have dropped staggeringly. While framing its post-lockdown strategy, what must the government do to ensure that households across the country have enough to meet basic requirements?
In the sixth episode in the series on the coronavirus pandemic, Yamini Aiyar, President and Chief Executive of the Delhi-based think tank, speaks with Mahesh Vyas, Managing Director and Chief Executive Officer of the Centre for Monitoring the Indian Economy.
Sharing findings from the centre’s regular household surveys, Vyas points out that unemployment rate shot up to 23%-24% from 7%-8%, labour force participation rate dropped to 35.5% from 43%, and over 45% households reported a reduction in income compared to a year ago. He recommends better communication from local governments to build confidence among workers and direct income transfers, equivalent to at least two months of salary, to beneficiaries despite chances of wastage.
This is the sixth in a series of episodes by the Centre for Policy Research on the unfolding coronavirus pandemic in India. You can follow the Centre’s work on Covid-19 on Twitter or visit www.cprindia.org. You can listen to all the episodes in the Coronavirus Conversation series here.