MGNREGS employment peaked during lockdown in 2020: Economic Survey

The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) employment peaked during the nationwide lockdown imposed to curb the Covid infection in 2020 as per the Economic Survey tabled in Parliament on Monday.

The demand for work under MGNREGS is an indicator of rural labour markets. An analysis of the latest data on demand for work under MGNREGS suggests that the employment peaked during the nationwide lockdown in 2020. However, the demand for MGNREGS work stabilised after the second COVID wave as per the Economic Survey. The survey said that the aggregate MGNREGS employment is still higher than the pre-pandemic level. The aggregate demand for MGNREGS work peaked in June 2020, and has thereafter stabilised, it said.

As per the survey, the demand for MGNREGS employment reached the maximum level of 4.59 crore persons in June 2021. Nonetheless, after accounting for seasonality, the demand at an aggregate level still seems to be above the pre-pandemic levels of 2019, the survey said. The demand for work under MGNREGS has reduced to below the pre-pandemic levels during the last few months in states like Andhra Pradesh and Bihar.

The higher MGNREGS demand may be directly related to the movement of migrant labour, the survey said. However, state-level analysis shows that for many migrant source states like West Bengal, Madhya Pradesh, Odisha, Bihar, the MGNREGS employment in most months of 2021 has been lower than the corresponding levels in 2020, it said. In contrast, the demand for MGNREGS employment has been higher for migrant recipient states like Punjab, Maharashtra, Karnataka and Tamil Nadu for most months in 2021 over 2020.

The allocation to MGNREGS in the Financial Year 2021-22 increased to Rs 73,000 crore, from Rs 61,500 crore in FY 2020-21. Allocation for FY 2021-22 has been enhanced to Rs 98000 crore so far. In FY 2021-22 over 8.70 crore individuals and 6.10 crore households were provided work so far.

The Atmanirbhar Bharat Rojgar Yojana (ABRY), announced as a part of Atmanirbhar Bharat 3.0 package to boost the economy, has increased the employment generation in post COVID recovery phase and to incentivize creation of new employment along with social security benefits and restoration of loss of employment during COVID-19 pandemic, said the economic survey.

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