Economic & Finance

India’s Increasing Unemployment Crisis due to Covid-19

India's unemployment crisis

India’s unemployment crisis has increased due to Covid-19. According to the Centre for Monitoring Indian Economy and International Labour Organisation, the unemployment crisis has existed for six years.

Furthermore, India’s youth is frustrated with the job crisis and opting to migrate to Canada. Last month India’s unemployment rate slumped to 7.9% from a 23.5% peak in April 2020. 

Why is India’s youth ‘off to Canada’?

Arvind Kejriwal, Delhi Chief Minister, said, “Because of a lack of employment opportunities here, every kid looks to Canada. Parents hope to somehow send their kids to Canada.” 

However, in December, the rate in Canada saw a 5.9% multi-month-low. A sixth straight month of decline in October suffocates the OECD group of rich countries. 

Srijan Upadhyay, a 31-year old IT graduate, says, “There are not enough jobs for us here, and whenever government vacancies come up, we hear of cheating, leaking of test papers. I am sure we will get a job in Canada, whatever it is initially.”

India’s increasing unemployment crisis due to Covid-19 forced Srijan, a food supplier to roadside stalls vendor, to shut his business. 

Many Srijan’s customers had to shut down their businesses without paying him. 

Is there relief in sight?

Head of the Centre for Sustainable Employment in Azim Premji University in Bengaluru Amit Basole said, “To an extent, if a particular sector is doing well, then some arrangements can be made to ensure the local youth get opportunities.”

Nevertheless, Delhi CM Arvind Kejriwal says, “I assure you, within five years, they will start returning because we will create so many opportunities for them here.” 

While Mr. Kejriwal did not elaborate, his party workers say they have policies in place to attract job-creating businesses. 

However, Amit Basole continued, “But if overall job creation is weak, then such policies do not solve the underlying problem. And they may also make things worse by reducing investment.” 

Furthermore, Haryana’s automobile hub and base for global IT companies have ordered a reservation of jobs for local residents. 

What do experts say?

According to the labour ministry’s career website, there are only 220,000 vacancies as of last month. With over 13 million active applicants, the ministries of labour and finance refused to comment. 

With more than 1.35 billion people of working age, the ministry told the Parliament in December, “employment generation coupled with improving employability is the priority of the government.”

Blue Line counsellor Lovepreet said, “I have been doing this for four years. I am off to Canada myself, this year or next year. Politicians keep promising jobs, but no one delivers.” 

CMIE Managing Director Mahesh Vyas told Reuters, “The situation is worse than the unemployment rate show. The unemployment rate only measures the proportion who do not find jobs of those who are actively seeking jobs. The problem is the proportion seeking jobs itself is shrinking.”


India’s increasing unemployment crisis due to Covid-19 poses a more significant threat than it seems. While 12 million people are reaching employment age annually, the Indian economy is not vast enough to absorb so many applicants. 

Furthermore, India must invest in labour-intensive industries while also hiring more women into the labour force.

Also Read – Indian economy is yet to get stable despite increase in last months: Report

Johannah is a passionate traveler. She is seeking remote places across India and exploring the benefits of being a Nomad. She has completed her bachelor's in Psychology Hons and diploma in Graphology. Being able to write helps her to share her experiences and be independent to travel anywhere.


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