Unemployment At Historical Low Due To Big Government Spend On MGNREGA
The unemployment rate in India, contrary to popular belief, has fallen from 9.5 per cent in August 2016 to a historical low of 4.5 per cent in February 2016, a report prepared by the State Bank of India has revealed. The report is based on data collected by the Bombay Stock Exchange and the Centre For Monitoring Indian Economy.
As per the report SBI Ecoflash,
Among major States, during the same period, sharp decline was registered in Uttar Pradesh (17.1 per cent to 2.9 per cent), Madhya Pradesh (10.0 per cent to 2.7 per cent), Jharkhand (9.5 per cent to 3.1 per cent), Odisha (10.2 per cent to 2.9 per cent) and Bihar (13.0 per cent to 3.7 per cent).
The report states that “government's efforts in providing new employment opportunities in rural areas” is the main reason behind the low unemployment rate, adding that rise in spending on MGNREGA has spurred employment in rural areas.
In the Union Budget 2017, the government hiked MGNREGA allocation to Rs 48,000 crore. The scheme now covers 167 lakh households, compared to only 83 lakh households in October 2016.
“Notable increase was registered in the works of Anganwadi (166 per cent), Drought Proofing (158 per cent), Rural Drinking Water (698 per cent) and Water Conservation & Harvesting (142 per cent),” the report says.
In addition, work completed under the scheme has also reportedly increased by 40 per cent to 50.5 lakh in FY2017, compared to just 36 lakh in FY 2016. The government has achieved the target of building five lakh ponds and 10 lakh compost pits. Another five lakh ponds will be added in 2017-18, providing more employment opportunity for the rural population.