Monday, May 23, 2022

A doubtful unemployment rate of 9.1% !

The latest “Labour force, Employment and Unemployment” indicator for the year 2021 shows an unemployment rate of 9.1% compared to 9.2 % in 2020.The labour force, employment and unemployment figures are based on the results of the Continuous Multi-Purpose Household Survey (CMPHS).
However, employment of Mauritians is estimated at only 484,400 in the 2021 compared to 517,900 in 2020- a decline in employment by 33,500.
Please note that the economically active labour force shows a decrease of 37,300 between 2020 and 2021 . Why ?
Because Statistics Mauritius (SM) classifies the individuals and self-employed persons who were not looking for work during as (temporarily) ‘inactive’ and not as ‘unemployed’. Note that although they were classified as inactive, they received the support provided by Government under the Self-Employed Assistance Scheme . This potential labour force not classified as unemployed was 42,000 in 2020 and 14,900 in 2021.
As reported in today's l'express, if we include the 42,000 of the potential labour force , we have an activity rate of 61.1 % in 2020, which usually shows a steady decline over the years , not by -4.1% in a single year.(The yearly changes, over the period 2011 to 2019, that have never exceeded 1.1%.)
Assuming a more reasonable decline of 1.1% in the activity rate (on the basis of the lower population, aged 16+, in 2021), the unemployment rate works out to be 20% in 2021. Even if we maintain the same activity rate as 2020,an exceptional year because of the lockdown, and including the 14,900 of the potential labour force, the unemployment rate is as high as 16%