“But there was a cyclical slowdown during Q2 of 2024 compared to Q1, which is likely to be associated with the uncertainty surrounding the national elections,” the report by the Indian Council for Research on International Economic Relations (ICRIER) stated.
The slowdown is temporary, as the medium-term conditions remain strong; year-on-year, with stronger gains expected for female workers, the data suggests.
As per the report, the improvements in labour market conditions are a nationwide phenomenon, with 19 out of 22 major states and UTs seeing an increase in labour force participation rate (LFPR), and 18 out of 22 states experiencing an increase in worker population rate (WPR) and 14 out of 22 reported a decline in the unemployment rate.
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As per the think tank’s report, it is key to note that rising participation has not been associated with a structural transformation of urban India, with the share of workers in industry falling and the share of workers in agriculture rising in urban India.
Comparing the data for the second quarter, the report states that between 2018-2024, the share of workers in the primary and tertiary sectors has modestly increased in urban India, while it has declined in the secondary sector – indicating that there was no structural transformation of the economy.
“The fact that the share of female workers in the primary sector has increased (from 6.7% to 8.9%) and the share of male workers in the secondary sector has fallen (35.6% to 33.9%) is particularly worrying,” it added.
According to the report, one out of every six urban male workers is in sales, one out of 12 is a driver, and one out of 50 is an ICT professional. “Urban male workers are mostly employed as salespersons (10%), mining and construction workers (11%), drivers (8%), and CEOs (6%).” A vast majority (84%) of urban male workers fall into just 20 occupations in urban India.
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Only 18% of urban male workers are in high-skilled occupations, that is working as CEOs and legislators, ICT professionals, teachers in colleges and universities, managers and MBA professionals, the report said.
On the other hand, the occupation of urban female workers is very different from that of their male counterparts – they are more likely to be employed as chefs and tailors (13%), cleaners and helpers (11%), teachers (10%), ag workers (7%), and personal service providers (7%).
The percentage of urban female workers working as salespersons (10%), ICT professionals (3%), MBA professionals (2%), and health professionals (2%) is not dissimilar to urban male workers.
Also, only 24% of female workers are employed in high-skill occupations, as per the report.
Separately, the report also points out that the urban labour market is rapidly feminising with more women joining the labour force, their occupation structure rapidly evolving, yet, the gender gap, though declining, remains very high.
