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Labour Incomes in India: A Comparison of Two National Household Surveys

Author

Listed:
  • Mrinalini Jha

    (O.P. Jindal Global University)

  • Amit Basole

    (Azim Premji University)

Abstract

The COVID-19 pandemic created a need for high-frequency employment and income data. Policy-makers and researchers of developing countries typically have not had access to such data. In India, a new private high-frequency panel dataset has recently emerged as the dataset of choice for analysis of the economic impact of COVID-19. This is the Consumer Pyramids Household Survey (CPHS) conducted by the Centre for Monitoring the Indian Economy (CMIE). But the CPHS has also been criticised for being inadequately representative nationally by missing poor and vulnerable households in its sample. We examine the comparability of monthly labour income estimates for the pre-pandemic year (2018–19) for CPHS and the official Periodic Labour Force Survey (PLFS). Across different methods and assumptions, as well as rural/urban locations, CPHS mean monthly labour earnings are anywhere between 5 percent and 50 percent higher than corresponding PLFS estimates. In addition to the sampling concerns raised in the literature, we point to differences in the way employment and income are captured in the two surveys as possible causes of these differences. While CPHS estimates are always higher, it should also be emphasised that the two surveys agree on some stylised facts regarding the Indian workforce. An individual earning ₹50,000 per month lies in the top 5 percent of the income distribution in India as per both surveys. Second, both PLFS and CPHS show that half the Indian workforce earns below the recommended National Minimum Wage.

Suggested Citation

  • Mrinalini Jha & Amit Basole, 2023. "Labour Incomes in India: A Comparison of Two National Household Surveys," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 66(1), pages 181-201, March.
    • Handle: RePEc:spr:ijlaec:v:66:y:2023:i:1:d:10.1007_s41027-023-00427-8
    DOI: 10.1007/s41027-023-00427-8
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    References listed on IDEAS

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    1. Ashwini Deshpande, 2020. "Early Effects of Lockdown in India: Gender Gaps in Job Losses and Domestic Work," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 63(1), pages 87-90, October.
    2. Sanjoy Chakravorty & S. Chandrasekhar & Karthikeya Naraparaju, 2019. "Land Distribution, Income Generation and Inequality in India's Agricultural Sector," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 65(S1), pages 182-203, November.
    3. Mahesh Vyas, 2020. "Impact of Lockdown on Labour in India," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 63(1), pages 73-77, October.
    4. Bussolo,Maurizio & Kotia,Ananya & Sharma,Siddharth, 2021. "Workers at Risk : Panel Data Evidence on the COVID-19 Labor Market Crisis in India," Policy Research Working Paper Series 9584, The World Bank.
    5. Arpit Gupta & Anup Malani & Bartosz Woda, 2021. "Inequality in India Declined During COVID," NBER Working Papers 29597, National Bureau of Economic Research, Inc.
    6. Bhattacharya,Shrayana & Sinha Roy,Sutirtha, 2021. "Intent to Implementation : Tracking India’s Social Protection Response to COVID-19," Social Protection Discussion Papers and Notes 160059, The World Bank.
    7. Somanchi, Anmol, 2021. "Missing the Poor, Big Time: A Critical Assessment of the Consumer Pyramids Household Survey," SocArXiv qmce9, Center for Open Science.
    8. Rosa Abraham, 2019. "Informal Employment and the Structure of Wages in India: A Review of Trends," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 65(S1), pages 102-122, November.
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    Cited by:

    1. Bino Paul & Krishna Muniyoor, 2024. "What Determines the Dichotomy between Formal and Informal Employment: Evidence from Maharashtra, India," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 67(2), pages 483-499, June.

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    More about this item

    Keywords

    Income data; Labour income; Income distribution; Household survey data; India;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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