Work demand under MGNREGS falls for 12th consecutive month in October

For the 12th consecutive month, work demand under the MGNREGS fell in October, reflecting a shift in the rural economy toward more lucrative job opportunities

The government's flagship rural employment programme has witnessed a sustained decline in work demand for the 12th consecutive month in October, compared to the same period last year. This trend reflects robust economic activities, particularly in sectors that offer more lucrative job opportunities, alongside a favourable base effect. 

Data from the Ministry of Rural Development indicates that around 19.89 million people sought employment under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) in October, marking a 9.2 per cent decrease from the previous year. These individuals represented 16.97 million households, which is a 7.6 per cent decline year-on-year, according to a report by The Economic Times.

 

 

The report quoted a senior government official as saying that this ongoing decrease signifies a positive upswing in the rural economy.

 

From April to October, 182.45 million individuals from 143.05 million households applied for work under MGNREGS, showing declines of 14.9 per cent and 15.3 per cent, respectively, compared to the same timeframe in the previous year.

 

Month-on-month trends

 

Despite the Y-o-Y drop, there was a M-o-M increase in work demand in October. Individual demand rose by 5.1 per cent, while household requests for work increased by 5.9 per cent compared to September figures.

 

The erratic rainfall during the monsoon months of July to September 2023 had previously sustained demand for MGNREGS work. However, since November 2023, demand has started to taper off. Experts suggest that the abundant rainfall this year has led many unskilled workers to transition into agriculture, thereby decreasing the need for MGNREGS jobs, as mentioned by the report.

 

In its recent economic review for September, the finance ministry highlighted ongoing improvements in rural demand due to rising sales of fast-moving consumer goods (FMCG), three-wheelers, and tractors. This comes amid a slowdown in urban consumption.

 

Additionally, the bi-monthly Rural Economic Conditions and Sentiments Survey from the National Bank for Agriculture and Rural Development reported that over the past year, 37.6 per cent of rural households experienced an increase in income, and 80.1 per cent saw a rise in consumption expenditures. This data underscores a vibrant momentum in rural economic activity, as stated in the finance ministry’s review.

 

Economic growth forecast

 

The International Monetary Fund (IMF) projects that India will retain its status as the world's fastest-growing major economy for both this financial year and the next, with expected growth rates of 7 per cent and 6.5 per cent, respectively, significantly surpassing global averages.