Demand for work under rural jobs scheme eases in key June quarter

Person-days generated under the scheme were to the tune of 1,110 million between April and June this fiscal, against about 1,140 million and 1,160 million in the corresponding quarters of FY23 and FY22, respectively, showed an analysis by the rural development ministry.

The rural development ministry has pegged the 2024-25 person-day generation target (called labour budget) at 2.21 billion under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), down 27% from the actual level in the previous fiscal.

MGNREGS received additional ₹3,400 crore, raising total allocation to ₹89,400 crore. Person-days exceeded targets. 10% wage hike during 8.4% growth. 'Below normal' 2023 monsoon affected work demand projections.

About 93% of the FY24 budgetary allocation of ₹60,000 crore for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) has been released, a person familiar with the details told ET. This has prompted the rural development ministry to seek substantial supplementary demands for funds to run the scheme throughout this fiscal year, he said.

The demand for work under the government's rural job scheme, MGNREGS, has seen an unusual trend this fiscal year. While demand usually peaks in the summer months, it has grown rapidly during the monsoon season. Experts believe that erratic seasonal rains have prevented rural workers from migrating to farming, leading them to rely on the MGNREGS for employment.

Work demand under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) saw a significant decline in July, dropping 21.6% year-over-year and 33.4% from the previous month. The decrease is attributed to strong economic activity and ample monsoon rains, which have shifted unskilled labor towards agriculture.

Demand for work under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) dropped 2% YoY in May due to allegations of fund misappropriation in West Bengal, but rose 34% MoM due to subdued farm activity. However, demand for work excluding West Bengal rose 0.4% YoY. The scheme typically experiences higher demand during the summer, with some states exhausting over 50% of their labour budget in the June quarter.

The individuals who sought work under MNREGS in December represented 19.97 million households, down 5.7% from 21.18 million households a year earlier. Demand for work under the MGNREGS moderated for a second straight month in December from a year before. Most of the demand came from Tamil Nadu (3.35 million), Rajasthan (2.60 million), Madhya Pradesh (2.38 million), Uttar Pradesh (2.34 million) and Bihar (1.59 million).

In reply to a question on the MGNREGS funds being exhausted, Minister of State for Rural Development Sadhvi Niranjan Jyoti said the Union government has released Rs 66,629 crore to states for wage, material and administrative components under the scheme till November 29.

The unusual move came after 95% of the FY24 budgetary outlay of ₹60,000 crore for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) was exhausted well before the commencement of the winter session of parliament, thanks to a rise in work demand, the official told ET.