Unemployment is in the rise again for the past few months. The Centre for Monitoring Indian Economy (CMIE) published a report on February 27 that showed 31 million people unemployed in India who are seeking jobs. It has spiked up to 7.1% after a low of 3.4% in July 2017.

The demonetization is a major reason for this rising rate. After the note ban in November 2016, many people who sought jobs stopped doing so and focused on acquiring new skills for themselves to survive in this new digital economy. The labour participation rate fell as well but has gone up to some extent in the months following the demonetization.

Rural regions have a chance of an increase in some level of employment when the harvest season begins. Once the rabi crop is harvested, and the Kharif season begins in May, there is no activity either.

Urban India faces fresh unemployment every year when a fresh batch of college students graduate. There is already a 31 million job post deficit, how is it expected to place thousands of these new students as well? These are the educated unemployed section of society. In the 2018 financial year, the estimated number of new jobs created is 600,000. This is not enough. If the demand is much higher than the supply, the shortage is bound to prevail.

The low level of employment is also a reason for depressing wages. Around 82% of men and 92% of women earn less than Rs. 10,000 per month. In the rising prices of the economy, even this is not a sufficient amount. So, people who do have jobs are not well off either. What India faces is rather an underemployment and low wages.

Perhaps this is why the present government encourages people to do more management courses and begin their own startups. The government is trying to fund the popular ideas. These startups would create new jobs for various kinds of people. An office has various requirements for people with different kinds of educational background and even for people without any education. Even the smallest of businesses can have 100-1500 people associated with it. If there were many new companies to emerge, fresh job opportunities may make the rate of unemployment go down to some extent. 

In an issue like this, wishing for immediate action and a sudden rise in job opportunities is silly. But in the long run, these new companies, institutes and other organizations may be able to soothe the strain of unemployment which the country faces to some extent.