1.9 crore salaried Indians lost jobs since COVID-19 lockdown, 50 lakh in July alone

The salaried class of the Indian population continues to reel under the catastrophic effects of the COVID-19 pandemic on an already-fledgling Indian economy. According to data released by Centre for Monitoring Indian Economy (CMIE), a total of 1.89 crore salaried people have lost their jobs in India since April, a little after the March 24 COVID-19 lockdown started. In July alone, five million salaried people have been rendered jobless, CMIE says.

“On a net basis, the plight of salaried employees has worsened since the lockdown began. In April, they lost 17.7 million jobs. But by July, the number reached 18.9 million,” the CMIE report said. It added that the situation has worsened for salaried jobs.

CMIE warned, “While salaried jobs are not lost easily, once lost they are also far more difficult to retrieve. Therefore, their ballooning numbers are a source of worry.” Economists have warned that healthy recovery is not on the anvil anytime soon. Prashant Kumar, economist at a financial services major, said, “Unless demand rebounds, jobs are unlikely to be created. Certain sectors are hit harder by the economic condition.”

The CMIE report showed that the manufacturing sector has been the worst hit with textile taking the biggest blow. In the textile sector, the wage bill came down by by 29%.

According to CMIE, salaried jobs have been declining much before the COVID-19 pandemic struck. It stood at 86.3 million in 2016-17, declining to 86.1 million in 2019-20. This shows that the Narendra Modi-led government at the Centre has failed to jumpstart an economy crippled by the whimsical 2016 decision of Demonetisation, followed by the faulty implementation of a GST regime in 2017.

One has to wait to see if the data forces the Centre to relax eligibility rules for availing unemployment benefits. Under the Atal Beema Vyakti Kalyan Yojana, the government pays 25% of the monthly salary as unemployment benefit for three months.This is for the workers who have signed up for the Employees’ State Insurance Corporation (ESIC) scheme.

Overall, the CMIE report punctures the balloon of quick economic turnaround being promised by the BJP ministers. If this is the condition of the formal sector which employs a tiny section, less than 20 per cent of the workforce, one shudders to think of the condition of the unorganised sector.