Measured in terms of gross domestic product (GDP) growth, the Indian economy has been recovering over the past few quarters of the post-pandemic period though concerns remain over the sluggishness of the labour market. Data from the Centre for Monitoring Indian Economy (CMIE) showed that the unemployment rate continued to be very high at 8.5% as of August 1, 2023. When such a high unemployment rate is combined with a significant decline in labour force participation (one of the lowest in recent times at 35.9% in 2022-23, according to the CMIE), it does not augur well for the prospects of the labour market in a country with an inadequate social safety network. Concerns over high unemployment predate the COVID-19 pandemic. The Periodic Labour Force Survey (PLFS) survey 2017-18 suggested an unemployment rate of 6.1% and pandemic-induced disruptions worsened the poor labour market outcome. The evidence is well documented in recent literature. The factors that impede the recovery of the sluggish labour market require utmost attention. Against this backdrop, the release of the PLFS 2021-22 report allows us to compare labour market dynamics in post-COVID compared with pre-COVID conditions.The PLFS is conducted in a July-June cycle. Since the last quarter of annual PLFS 2019-20 survey experienced the full force of first wave of pandemic and all the four quarters of 2020-21 survey encompassed both aftermath of the first wave as well as the devastating effects of the second wave (even if there was no national lockdown), the present study compares the employment situation in the PLFS 2018-19 and 2021-22, thereby mitigating any potential biases. In a break from the earlier trends reported in both the CMIE and PLFS surveys, the 2021-22 report shows improvements in the employment situation compared to all previous reports of the PLFS, which is a bit unexpected because the pandemic massively disrupted economic and social life. Based on the reports, the labour force participation rate (LFPR, which represents the number of people in the labour force as a percentage of the population) and the worker population ratio (WPR, or the percentage of employed persons in the population) of those aged above 15 years increased from 50.2% to 55.2% and from 47.3% to 52.9%, respectively, between 2018-19 and 2021-22. This reduced the unemployment rate from 5.8% to 4.1%The primary driver of this increase in participation is female participation. The rise in both LFPR and WPR is more than 8 percentage points for females while they increased marginally by 2-3 percentage points or males. Historically, females have had greater labour market engagement in rural areas than in urban areas and there was no exception to this even after pandemic.Among those who are 15 years and above, the WPR of rural women (in usual status) has increased significantly by 10.3%, from 25.5% to 35.8 %, with a marginal change in urban employment (from 18.4% to 21.9 %).Stylised facts about these increases in participation raise the question of the workers’ job locations. Where are the workers located?According to the National Statistical Office, workers are classified under three broad categories – self-employed, regular wage/salaried employee, and casual labour. In urban areas, a significant number of females are in regular salaried jobs. But in rural areas more women fall into the self-employed category. In pre-pandemic 2018-19, 59.6% of rural women were in self-employment, of which 21.8% worked as own account workers and the rest (37.9%) as helpers in household enterprises, which were mostly unremunerative (Table 1). In post-pandemic (2021-22), self-employment increased to 67.8% (by more than 8%) for females, with proportionately less increase in own account work and a significant increase in helpers. In rural areas, female participation as helpers is primarily as agricultural workers in family firms. Since agricultural activities (being essential items) were mostly permitted during the pandemic, the lockdown did not much affect female participation in farm activities as helpers. An industry-wise classification confirms that female participation in agriculture is not only around 70%; it has increased from 71.1% to 75.9% in post pandemic times while male participation in agriculture reduced from 53.2% to 51%.Despite the pressure of reverse migration, male workers joined less in agriculture in post-pandemic. In rural areas, males were largely engaged in self-employment activities. Compared to females, within self-employment, there were more male own account workers and few helpers and there were no significant changes in participation in post-pandemic. In urban areas too, the importance of self-employment activities as a source of livelihood grew for both males and females after pandemic. Table 1: Percentage distribution of workers in usual status by status in employment Self-employmentregular wage /salarycasual labourown account workers and employershelper in household enterpriseall self-employment Rural Female2018-1921.837.959.61129.32021-2225.142.767.88.124.1 Urban Female2018-1924.99.634.554.710.72021-2226.712.739.450.310.3 Rural Male2018-1948.29.257.414.228.32021-2247.311.358.614.726.8 Urban Male2018-1934.64.138.747.214.22021-2235.04.639.546.214.3Source: PLFS rounds.In the casual workers’ category, participation of both rural males and females has declined, with relatively greater declines observed for females (by 5.2% points compared to 1.5% points decline for males). The decline in female participation in casual work cannot be justified with unavailability of work under Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) since female participation in MGNREGA remains around 55% over 2018-19 and 2021-22 according to official statistics. The industry wise participation confirms that their participation has largely fall in non-agricultural activities like in construction work it has reduced from 6% to 5.3%, in trade, hotel and restaurant from 4.3% to 3.7%, other service from 9.1% to 6.8% respectively. The increase in household chores because of the pandemic, care responsibilities, competition from jobless males, and the pressure of reverse migration could have been other reasons for this decline.For males, the industry-wise participation confirms that their participation decline is mainly visible in agriculture 53.2% to 51%, but increase in participation in all other non-agricultural sectors mentioned above. So, the rural dynamics is changing in post COVID time. It is clear that while females were systematically pushed out from all these non-agricultural activities and greater engagement with farming, males are more in wholesale and retail trade, construction work, manufacturing, transport, communication, and other services which were even if disrupted by pandemic-induced lockdown but males reestablish their foothold. Conversely, for females, the displacement appears to be enduring and irreversible.Coming to regular salaried jobs, workers’ participation in them fell in both rural and urban areas irrespective of gender because of the lockdown. However, the magnitude of decline was more in urban areas, which have a higher concentration of regular salaried jobs. At the same time, it is noticeable that the magnitude of decline is more for females than males in both rural and urban areas which again reenforces the notion of discouraged worker effect or permanent loss of women from job market. This again can be connected with social security provision under regular jobs. According to the 2021-22 PLFS report, 62% of regular salaried workers do not have a written job contract, 49.2% of regular wage/salaried employees not eligible for paid leave, 53% are not eligible for any social security benefit. The Covid-19 pandemic exposed the fragility of livelihoods due to the growing informalisation of formal jobs. Education and workforce participationThe increase in women’s work participation in rural areas was observed across all education levels after pandemic (Table 2). But the WPR was significantly higher for illiterate women and those who had studied to the primary level, coinciding with the higher participation of females as helpers. The U-shaped relationship, particularly the high WPR at low levels of education, was because those at the lower end of the education spectrum could not afford to remain unemployed. Interestingly, both in rural and urban areas, those with a technical education (diploma/certificate courses) obtained jobs at a greater proportion even after pandemic, which reconfirmed the importance of skilled workers to the service-led growth of India. Table 2: WPR across education levels for 15 years above population Not literateLiterate, up to primaryMiddleSecondaryHigher secondaryGraduatePost graduate and aboveDiploma/ certificate coursesRural female2018-1930.729.82117.213.818.431.534.32021-2243.743.430.623.020.925.735.350.5Urban female2018-1921.920.615.99.99.523.136.8342021-2224.026.518.813.813.825.937.441.3Rural male2018-1976.585.674.760.555.869.175.466.42021-2277.386.978.365.161.175.683.976.3Urban male2018-1972.680.273.160.652.369.579.973.72021-2272.982.974.961.555.871.780.576.2Source: PLFS rounds. Interestingly, for males, there is no significant difference in participation across all education levels between rural and urban areas, and the pandemic did not make any significant difference to this pattern. This can partly be explained by the role of men as breadwinners, which was backed by a long history of masculinity. Contrary to the general perception, the higher workforce participation among less educated workers pointed to a precarious job recovery. The relatively lower workforce participation among the educated points to higher unemployment among the educated, perhaps due to the lack of jobs that match their expectations. In all likelihood, technology-driven post-pandemic recovery may accentuate this problem. Impact on the Disadvantaged The Indian labour market is segmented among social and religious groups. Even though Covid-19 was thought to be blind to social stratification, the vulnerability to the virus was not homogeneous in all social and religious groups. Overall, socially disadvantaged communities had a higher WPR than the general category and it increased after the pandemic – by 7.4 percentage points for Scheduled Tribes from 40.6% to 48%, followed by 4 percentage points for Scheduled Castes, 4.2 percentage points for Other Backward Classes, and 3.4 percentage points for the general category. Compared urban areas, the work participation of women from disadvantaged communities was much higher in rural areas. After the pandemic, there was a sharp increase in the female WPR in rural areas, particularly among STs (from 28% to 40.1%), followed by SCs (18.9% to 25.7%) and OBCs (18.9% to 25.9%). The male WPR has changed marginally by 3-4 % and remains around 50-55% across social groups in rural and urban areas. Given the low asset base at home, perhaps women from disadvantaged social groups could not afford to wait for better prospects. In terms of religion, Christians had the highest WPR (42.6%), followed by Hindus (40.5 %), Sikhs (38.9 %), and Muslims (33.5%) in 2021-22. While there is no significant difference in the male WPR across religions, for females, particularly in rural areas, it varied to a large extent. There was a notable surge of 9.4 percentage points in the WPR within the Christian demographic, closely pursued by a rise of 5.7 percentage points among Muslims and a 4.6 percentage point upturn among Sikhs.Me Occupying the lower rung on the socio-economic hierarchy, individuals hailing from religious minority groups found themselves compelled to eschew unemployment.Whether we look at the rise in unemployment or precarious employment after pandemic, it points to the sluggishness of the labour market. An examination of the latest PLFS shows that despite some improvements in labour market outcomes, concerns remain about the quality of jobs. The analysis of labour market outcomes in terms of rural and urban, gender, education, and social and religious groups shows that structural questions relating to the segmentation of labour market require urgent attention. There is higher workforce participation among women, especially from disadvantaged groups. If these structural problems are not addressed, post-pandemic growth will be more unequally shared than earlier. Public policies designed to address concerns about the job market should not only focus on employment generation, which has been low since the pre-pandemic period, but also aim to improve the quality of jobs. Namrata Singha Roy teaches Economics at Department of Economics, Christ University, Bengaluru.