The current reverse migration of labour force in Bihar has significant economic implications

Was the countrywide lockdown announced too early and was too strict? And now the country has been opening up at a time when the situation is pretty alarming. Well, this is a question of discussion and the answer of which can be manipulated and presented in both for and against the case made. But, the suddenness of the nationwide lockdown created havoc resulting in massive job loss across the country. With no jobs in hand and expensive lives in the urban concrete jungle sparked the process of reverse migration. It has been seen that by mid-may over 3 crore people returned to their natives due to job loss in these hard times. Out of the 3 crore over 25 lakhs people have reverse migrated to the state of Bihar, due to which the unemployment rate sprung to over 19% in June, which is 12% more than the nation’s unemployment rate. So the underlying questions of how the state will provide and sustain such a large population of reverse migrants.

Over 56% of the labour force of Bihar is engaged in agriculture, 8% in Industry and 36% in services. Agriculture as an occupation cannot add more to the output as the employment elasticity of output is already close to zero. Bihar also has evidence of increased circular migration due to the high cost of living in urban areas. Bihar’s growth in recent time has been significant in terms of numbers but nearly 1/3^rd of the population still lives below the poverty line, with 40% of the youth having no jobs raising the unemployment level in the state.

Migrants and the Economy

Remittances makeover more than 5.5% of the Bihar’s GDP.  With the return of these migrant workers and an increase in public expenditure due to the ongoing pandemic, the economy can take a toll and can be catastrophic. Moreover, the poor state of the industrial sector in Bihar adds to the trouble. Recent plans by the central government to boost the MSME sector will not be of any benefit. Quick and efficient interventions have to be made by the state and central government.

 Bihar became the first state to do a skill-mapping of these workers. Maximum efforts should be given to provide jobs according to the skill and paid for the same so that he has a certain reason to hold to. MGNREGA plays an important role in the generation of jobs in the short term to unskilled people. The central government on June 20^th launched 25 rural centric employment generation schemes providing 125 days in 25 areas to the migrant worker in 116 districts of 6 states including Bihar. 32 out of 38 districts of the state has been included in the scheme making sure that employment is generated and the migrant workers get a livelihood in his/her home state.

Author:
Sneh Shrivastava
Department of Economic Studies and Policy
Central University of South Bihar