Navigating the Nuances of Jammu and Kashmir’s Labour Market Recovery

M IMRAN KHAN

The recently published Economic Survey 2023 by the Government of Jammu and Kashmir paints a promising picture of the region’s labour market. It indicates a commendable rebound in both urban and rural areas, suggesting a recovery from the aftermath of the COVID-19 crisis. However, we must approach these findings with caution and delve deeper into the report’s nuances that may not be immediately apparent. There are two significant omissions in the Economic Survey 2023 that cast shadows on the overall assessment, and we must address them to understand the true extent of the recovery and its implications on the workforce.

Firstly, it is essential to acknowledge that the Jammu and Kashmir economy had to endure a double lockdown. The abrogation of Article 370 and 35A on August 5th, 2019, followed by the nationwide COVID-19 lockdown on March 25th, 2020, imposed significant challenges on the state’s economy. However, the survey fails to provide estimates of the magnitude of loss of jobs or work due to this double lockdown. Secondly, the survey claims post-COVID recovery on the basis of increase in worker and labour force participation rates but fails to report the qualitative assessment of recovery in terms of nature of employment generated in the economy. Without taking such factors into consideration, we might overlook the actual impact of these lockdowns on the region’s workforce.

To gain a comprehensive understanding of the labour market situation in Jammu and Kashmir, we must move beyond macro numbers and delve into more detailed data from the Periodic Labour Force Survey(PLFS). This survey is conducted since 2017-18 annually for both rural and urban areas and quarterly for urban areas only by Ministry of Statistics and Programme Implementation(MOSPI), Government of India. It becomes imperative to consider the estimates of the number of workers who lost jobs or work during the crisis period. Due to the unavailability of census data post 2011, the population estimates for the year 2021-22 in Jammu and Kashmir were derived from the official population projections released by the Ministry of Health and Social Welfare, Government of India. The estimated population stood at 134.4 lakh, out of which 51 lakh were employed and 5 lakh were unemployed. The Periodic Labour Force Survey (PLFS) only covers quarterly surveys for urban areas, leaving out estimates for the rural areas, which constitute the majority of the workforce. Despite this limitation, our examination of urban areas, with around 14.5 lakh workers in 2021-22, has unveiled perplexing trends.

One crucial factor contributing to this complexity lies in how employment is defined and the metrics used to arrive at the figures. The official report’s aggregate employment statistics mask an important category of workers who were considered employed but couldn’t attend their workplaces due to sickness or other reasons. According to the Current Weekly Status (CWS) definition, these workers typically constitute less than one percent of the workforce. However, during the lockdown, this category of workers surged to around forty percent of the total employed in April-June 2020 quarter, an unprecedented increase in workers reporting no work in urban areas. The majority of these workers reported no earnings during this period, directly attributed to work loss resulting from consecutive lockdowns on the Jammu and Kashmir economy. While some workers lost work but retained their jobs, others faced job loss entirely due to the double lockdown. Comparing the quarters affected by the lockdown with normal year quarters, it is estimated that more than seven and a half lakh workers faced work loss while retaining their jobs, and around five lakh workers lost their jobs entirely due to the double lockdown.

To truly understand the recovery process in the labour market, we must recognise that it is anything but uniform. Economic stress and external shocks have forced households to seek alternative forms of work, such as self-employment, even in the face of declining wage-based opportunities. Vulnerable workers, dependent on employment for their livelihoods, must adapt to the changing landscape. Additionally, women and those pursuing education, traditionally outside the labour force, might enter the workforce in response to challenging circumstances. The data reveals a rise in self-employment and casual wage work for both men and women during the lockdown period, with a particularly noticeable increase in women’s self-employment and men’s casual wage work. However, despite a quantitative rebound in the labour market, there is a clear indication of workforce informalisation and signs of distress in the post-crisis recovery.

As Jammu and Kashmir charts its path to recovery, it is crucial to recognise the complexities underlying the aggregate employment figures. A nuanced approach is essential to comprehend the true impact of exogenous shocks on the region’s labour market. We must formulate targeted policies that address the diverse challenges faced by different segments of the workforce, paving the way for a more equitable and inclusive recovery that ensures the well-being of all stakeholders in the region’s economic resurgence. By acknowledging these nuances, we can lay the groundwork for a brighter and more promising future for Jammu and Kashmir.

M. Imran Khan, PhD, Assistant Professor, School of Economics, NMIMS, Mumbai.