1.4 CRORE JOB LOSS IN 2020

     1.4 CRORE JOB LOSS IN 2020

Out of the blue when the first case of the Wuhan virus steps into India on the 30th of January, No of us have thought that just in the time frame of 33 days it will engulf the whole country into itself. I am writing this article on the 4th of April as today the number of cases is close to 3000 and the number of deaths is 68.

The impact of the Wuhan virus on the Indian economy and Jobs in India is way worse than one has thought of. According to estimates based on the National Sample Survey (NSS) and Periodic Labour Force Surveys (PLFS) data, about 136 million non-agricultural jobs are at immediate risk. This problem more for people who are not having a regular salary. Already the nation was trying to paddle hard in slow GDP growth of 4.5% and now the Wuhan virus will badly affect the economy.

In 2019 the rate of unemployment is 7.48%  which quit high in the 2nd term of the Modi government. But what we are seeing is Just Tip of Iceberg, that is more slump in the rate of unemployment is yet to be seen. The coronavirus situation will only exacerbate unemployment. The Wuhan virus pandemic comes at a difficult demographic time for India and would only exacerbate a looming jobs crisis. India needs to create nearly 10 million jobs every year to absorb people moving into the working-age population, besides those that are already unemployed. About nine million jobs can be reduced across the manufacturing clusters of textiles, capital goods, cement, food products, metals, plastics, rubber, and electronics.

Statistics

India’s labor force is ~495 million. In 2017-18, about 30 million were unemployed, which implies that 465 million are currently employed. The most vulnerable among these are those that don’t have the security of employment; those without any social protection. They are often bracketed as “informal" workers. The number of informal workers totals = 217 million across services, manufacturing, and non-manufacturing sectors.

IMPACT ON NO CONTRACT WORKERS

The informal sector people are the ones who don’t have a written contract and include casual laborers, those who work in non-registered nano businesses, registered small

companies, and even the self-employed. They can be fired without notice or severance.

Most daily-wage earners or casual laborers fall in this bracket.

Overall, about 136 million workers in India, or over half the total workers employed in non-agricultural sectors, have no contracts and remain the most vulnerable in the aftermath of

the corona outbreak.

•  28 million have no written jobs contracts in manufacturing;
•  49 million in non-manufacturing;
•  59 million in services

While the daily-wage earners are bearing the brunt in the first phase of retrenchments, companies across industries could let go of employees on short-term contracts next. Over five million Indians have job contracts less than a year in tenure. Many of the informal workers work in construction. Employment in real estate construction will be impacted because housing launches and sales are headed south given that lower economic growth is now a certainty.

Manpower cuts in the automotive industry started last quarter owing to falling sales.

The industry can lose up to a million jobs in the dealer ecosystem, front-line roles, and semi-skilled workers. Around 600,000 ground and support roles on contract in the aviation industry are at risk.

India’s largest employer by far services.  As of 2018, 31 % of India’s employed population is working in the services sector. The services sector is not only the dominant sector in India’s GDP but has also attracted significant foreign investment flows, contributed significantly to exports as well as provided large-scale employment. India’s services sector covers a wide variety of activities such as trade, hotels and restaurants, transport, storage and communication, financing, insurance, real estate, business services, community, social and personal services, and services associated with construction.