Fewer people are demanding work under the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) than in the past two years, the government said, indicating signs of stabilisation in the rural job market.
The number of people looking for work under the scheme reduced to 402 million in 2021-22 from 447 million in 2020-21, the Finance Ministry said on Friday, adding that monthly work demand has been declining consistently from May. More people, especially those who migrated to rural areas, were seeking jobs under the scheme during the COVID period.
The mandate of the MGNREGA is to provide at least 100 days of guaranteed wage employment in a financial year to every rural household whose adult members volunteer to do unskilled manual work.
According to the government's MNREGA data, the month-on-month demand for work was the lowest in August this year, when 19.3 million individuals demanded work. July saw a nearly 40 percent dip in demand for work — when 25 million persons sought work — then in May 2022, when 44 million persons wanted work.
The household demand for work has fallen 41 percent in August 2022 to 19 million as against 27 million in the same month last fiscal year.
However, according to the government, the demand was still higher than pre-pandemic levels.
While MGNREGA data indicated the rural job market stabilising, data from the Centre for Monitoring Indian Economy (CMIE) showed that India's jobless rate increased to 8.28 percent in August — the highest since August 2021.
As per the private research firm, the economy’s world-beating growth failed to translate into increased employment opportunities. The jump was because rural unemployment rose to 7.68 percent from 6.14 percent, and urban unemployment rose to 9.57 percent from 8.2 percent during the same period.
“The situation is worsening in rural India,” CMIE Managing Director Mahesh Vyas said. “Rains have not been very good, rice cultivation has dropped.”
Meanwhile, Union Finance Minister Nirmala Sitharaman said the Centre spent Rs 5 lakh crore on the MNREGA scheme in the past eight years, of which 20 percent was spent during the COVID-19 pandemic.
During the Budget 2022-23 announcement earlier in February, the government said it was targeting lower-than-expected outgo for subsidy, MNREGA and Finance Commission transfers to states, through which it saved a massive Rs 1.88 lakh crore.