Determinants of Unemployment in Rural India: An Exploration of NCAER Household Sunrey Data of 1994

This paper presents the leve1, nature and correlates of labour force participation and unemployment among the youth in rural India using the large-scale data from the survey of over 33,000 households in 1994. Besides examining the large inter-state differentials in the labour force participation as well as unemployment rates among the youth, the analysis explores the key micro-level (individual and household) and macro-level (vi 1 lagelcommunity) determinants of unemployment. Personal attributes such as age, gender, educational level, marital status and school enrolment status set the precondition to determine the labour force status among the youth. The demographic base of the household, together with endowment of resources available with the household, ascertains the supply of and demand for family labour in the rural community. The results from multivariate analysis also suggest an important influence of macro factors on labour force participation and unemployment among the youth. Significant effects of income, wage rate, infrastructure and employment-oriented programmes on unemployment are discernible, thus suggesting the need for a critical review of the existing employment and poverty amelioration and welfare programmes, and new policy initiatives in this direction.