Friday, 06 Mar, 2026
By: Lakshita Bhagat
The dramatic drop in the unemployment rate at the national level can be attributed to several factors. Source: IANS
The dip is particularly significant when compared with the annual high of 8.3% for the previous month of August 2022
According to the recent estimates from the Centre for Monitoring Indian Economy (CMIE), the unemployment rate has sharply improved (see the Figure below). The unemployment rate for September 2022 stands at 6.43%, which is the lowest not just in the last one but the previous four years. The dip is particularly significant when compared with the annual high of 8.3% for the previous month of August 2022. In line with the trend, the urban and rural unemployment rates have also registered a decline. While rural employment declined to 5.84% in Sep’22 from 7.68% in Aug’22, the urban employment rate fell to 7.7% from 9.57% for the same period.
Source: CMIE
As per the current figures, the states with less than 5% unemployment rate, which is also considered natural unemployment rate, are Chhattisgarh (0.1%), Assam (0.4%), Uttarakhand (0.5%), Madhya Pradesh (0.9%), Gujarat (1.6%), Meghalaya (2.3%), Odisha (2.9%), West Bengal (3.3%), Karnataka (3.8%), Maharashtra (4%), Uttar Pradesh (4%), Tamil Nadu (4.1%) and Andhra Pradesh (4.8%). Whereas, Rajasthan, Jammu & Kashmir, Haryana, and Tripura have some of the highest unemployment rates of 23.8%, 23.2%, 22.9%, and 17%, respectively. Significantly, four of the three worst-performing states are North Indian states.
The dramatic drop in the unemployment rate at the national level can be attributed to several factors. In July, there was an addition of 16 million jobs in agriculture and construction in July 2022, as per the CMIE. Additionally, a steady monsoon might have helped in stabilising the job market. The resumption of festivities in full fervour after a slump of almost two years is likely to have uplifted the economic activities positively impacting the labour market.
However, the jobs that have been added are primarily low quality and temporary in nature. The challenge thus is to create and provide quality jobs, especially for the educated masses as unemployment among them is quite high. In this direction, the central government has assured to provide 1 million central jobs over a period of 18 months. Finally, in the wake of the looming recession around the world due to geopolitical events, tighter monetary policy, and energy costs, India needs to tread cautiously
