Surge in Farm & Female Labour Force Participation: PLFS


    In Context

    • The recent Periodic Labour Force Survey (PLFS) Report mapping till the first three months of the pandemic (April-June 2020) has indicated 2 specific trends:
      • Reversal of the falling share of agriculture
      • A decisive turnaround in declining female participation
      • Both of these trends signify a break from the steady structural transformation in the labour market over the last 2 decades.

    Periodic Labour Force Survey (PLFS)

    • The National Statistical Office (NSO) launched the Periodic Labour Force Survey (PLFS) in April 2017.
    • Objective of PLFS is primarily twofold:
      • To estimate the key employment and unemployment indicators viz. 
        • Worker Population Ratio, 
        • Labour Force Participation Rate, 
        • Unemployment Rate)
        • in the short time interval of 3 months for the urban areas only in the ‘Current Weekly Status’ (CWS).
      • To estimate employment and unemployment indicators in both ‘Usual Status’ (PS+SS) and CWS in both rural and urban areas annually.
    • The most recent report is the 3rd Annual Report, brought out by NSO on the basis of Periodic Labour Force Survey conducted during July 2019-June 2020.
    • Conceptual Framework of Key Employment and Unemployment Indicators: 
    • PLFS gives estimates of key employment and unemployment Indicators like 
      • Labour Force Participation Rates (LFPR):
        • LFPR is defined as the percentage of persons in the labour force (i.e. working or seeking or available for work) in the population.
      • Worker Population Ratio (WPR):
        • WPR is defined as the percentage of employed persons in the population.
      • Unemployment Rate (UR):
        • UR is defined as the percentage of persons unemployed among the persons in the labour force.
      • Activity Status- ‘Usual Status’ (US):
        • Activity status of a person is determined on the basis of the activities pursued by the person during the specified reference period.
        • When the activity status is determined on the basis of the reference period of the last 365 days preceding the date of survey, it is known as the usual activity status of the person.
        • The longer-term “usual status” tends to include chronic unemployment and seasonal work patterns.
      • Activity Status- ‘Current Weekly Status’ (CWS):
        • The activity status determined on the basis of a reference period of last 7 days preceding the date of survey is known as the current weekly status (CWS) of the person.
        • The weekly approach is closer to the global norm, and captures unemployment over a shorter term.

    Source: PIB

    Key Findings of PLFS, their Significance and Misleading Nature

    • Based on the “usual principal status” and the “subsidiary status” approach following trends were observed:
    • Surge in Female Labour Force Participation Rate
      • It can be interpreted as a positive sign but there is a catch.
        • Much of this increase is in the most sub-optimal category of unpaid family workers
    • Rise in Employment in Agriculture
      • In agriculture,, the PLFS data show that in 2019-20, there has been an increase in the percentage of those reported to be working in the sector (45.6%). 
      • This comes after decades of a progressive fall that signalled movement to high productivity jobs outside.
        • Agriculture constitutes about 16 percent of the GDP
      • The rise in agriculture, too, is mostly in this category- those working in household enterprises without drawing wages.
    • Decline in Manufacturing Employment
      • The surge in Agriculture for 2019-20 corresponds to a decline in manufacturing and construction in the latest survey.
    • Signs of Distress before Pandemic
      • GDP had slowed down, demand had declined and manufacturing was not expanding even before the pandemic. 
      • Between 2004-05 to 2011-12, many exited agriculture to join the construction sector with a big push to infrastructure


    Source: IE

    Reasons Behind such Controversial Trends

    • Household distress precipitated by the steady fall in GDP growth rates over the past years.
    • Farm labour surge to a “hard lockdown” in urban areas due to Pandemic during April-June
    • The Twin Balance Sheet problem affected growth after 2011-12.
    • With the inability of the construction sector to absorb and slowdown in the manufacturing sector, workers got pushed back into agriculture.
    • Demand-side constraints, viz., that women’s participation is falling due unavailability of steady gainful employment.
      • Women are likely to be displaced from employment by male workers, especially when there are negative economic shocks e.g. demonetisation or the pandemic.
    • Industries that employ women haven’t done well. 
      • Unlike Bangladesh, we did not have labour intensive manufacturing. 
      • Even though rising education levels have been seen among females, there aren’t enough good jobs for them

    Conclusion and Way Out

    • Lot of people lost jobs during the pandemic and agriculture became the employment of last resort.
    • The PLFS estimates are instead an early warning of a structural crisis.
    • The first three quarters also suggest that a structural retrogression in the economy was underway before the pandemic.
    • There is a huge need for the creation of productive and remunerative jobs.
    • Also, a better indicator for the extent of joblessness in the economy would be the number of hours worked.

    National Statistical Office (NSO)

    • It is the central statistical agency of the Government under the Ministry of Statistics and Programme Implementation.
    • It is mandated under the Statistical Services Act 1980.
    • Functions
    • It is responsible for the development of arrangements for providing statistical information services to meet the needs of the Government and other users for information on which to base policy, planning, monitoring and management decisions.
    • The services include collecting, compiling and disseminating official statistical information.
    • Other Reports & Indices by NSO:
      • Index of Industrial Production (IIP)
      • Consumer Price Index (CPI)
      • Sustainable Development Goals National Indicator Framework Progress Report

    Source: PIB, IE