India, like many developing nations, has long sought to shift its extensive agricultural labour force towards non-farm sectors. Over decades, this transition had been slow, but steady. However, the COVID-19 pandemic has upended this trajectory, marking a significant reversal in recent years.

The India Employment Report 2024, jointly produced by the International Labour Organization (ILO) and the Institute for Human Development (IHD), reveals this stark reversal. Based on data from the Government of India's National Sample Surveys and Periodic Labour Force Surveys spanning from 2000 to 2022, the report highlights a notable shift.

Between 2020 and 2022, the agricultural sector saw a surge in employment by nearly 56 million workers. This surge coincided with the COVID-19 outbreak in March 2020, triggering strict lockdown measures that persisted into 2022, disrupting urban livelihoods and leading to a mass exodus of informal workers to rural areas.

This movement back to agriculture was substantial, with 30.8 million workers joining in 2020, followed by 12.1 million in 2021 and another 12.9 million in 2022. Notably, this shift included a reversal of the long-term trend where youth were steadily moving away from agriculture into non-farm sectors.

The report underlines that from 2000 to 2019, there was a discernible shift from low-productivity agriculture to higher-productivity non-agricultural sectors, resulting in negative growth in agricultural employment. However, the pandemic-induced economic slowdown saw a resurgence in agricultural employment, outpacing growth in agriculture's gross value added.

This surge back to agriculture was not limited to male workers; a significant portion consisted of women, with the female labour participation rate in agriculture reaching 62.8% in 2022, compared to 38.1% for men. The report suggests that this shift could be a response to the lack of opportunities outside agriculture, particularly for marginalised and migrant workers.

While this transition has altered the labour market landscape, particularly in rural areas where the workforce increased substantially compared to urban areas, it also raises concerns. The return to subsistence agriculture may indicate distress, as non-farm sectors struggle to create employment opportunities, leading people to return to less remunerative work in agriculture.

Additionally, the report notes that despite the increase in employment, wage growth has been sluggish or negative, especially for female self-employed workers. This disparity underscores the need for targeted interventions to support vulnerable workers and ensure inclusive growth across sectors.