Executive Summary of Nepal Labor Force Survey – 2008 (II)

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and above having never attended school in 1998/99 to 25.0 percent in 2008, and for rural areas, from 63.8 percent to 51.1 percent. million hours in 1998/99 to 38 million hours in 2008. ECONOMIC ACTIVITY The current labour force participation rate (the proportion of population aged 15 years and above who were currently economically active) decreased marginally from 85.8 percent in 1998/99 to 83.4 percent in 2008. The decline in the current LFPR was more marked in urban areas (from 73.3 percent to 67.3 percent) than in the rural areas. There has been a sharp drop in the proportion of children engaged in economic activity. The proportion of children aged 5 to 14 years who were currently economically active dropped from 40.9 percent in 1998/99 to 33.9 percent in 2008, with a sharp decrease in terms of percentage points in rural areas than in urban areas. In respect of the usual status (based on activities over the last 12 months), the participation rate increased only slightly over the decade for the 15 years and above population and 5 to 14 years population as well as in both urban and rural areas. EMPLOYMENT The total number of currently employed persons increased from 9463 thousand in 1998/99 to 11779 thousand in 2008. The employment-to-population ratio declined from 84.3 percent in 1998/99 to 81.7 percent in 2008. On the other hand the proportion of paid employees increased slightly from 16.0 percent in 1998/99 to 16.9 percent in 2008. Moreover based on the classification of industry 73.9 percent people work in the agriculture sector and 26.1 percent are engaged in non-agriculture sector. Total time spent at work by persons aged 15 and over has gone up to 517 million hours in 2008 from 413 million hours in 1998/99. Encouragingly, total time spent by children in economic activities has declined from 48 Among the employed persons, nearly 68 percent worked 40 hours and more, 20 percent 20-39 hours, 11 percent 1-19 hours and an insignificant proportion reported that they did not work in the reference week in 2007/8. While the proportion of the current employed working other hours was: 73, 17, 8 and 2 percent for 40 hours and more, 20-39, 1-19 and zero hours respectively in 1998/99. Among those working less than 40 hours in the reference week, the percentage of people who did not work more hours due to involuntary reasons increased from 15 percent to 21 percent in between 1998/99 and 2008, whereas due to voluntary reasons it decreased from 83 percent to 79 percent during the same period. Substantial increases between the two periods can be observed in average monthly earnings. Monthly average income in cash and kind from paid employment in nominal (current price) terms as compared to the previous survey has increased almost two and half times. The same pattern has also been seen in the monthly average earnings of males and females as well. However, the discrepancy in earnings between the males (higher) and females (lower) still remains as before. TIME-RELATED UNDEREMPLOYMENT AND LABOUR UNDERUTILISATION The time-related underemployment rate for the population of 15 years and above is 6.7 percent in 2008 as compared to 4.1 percent in 1998/99. The time-related underemployment rate increased for all age groups in between these two survey periods. The time-related underemployment rate was found to be the highest for 20-25 and 25-29 years of age groups (around 8 percent) and the lowest for those aged 60 years and above age group (5 percent) in this survey. Pre Liminary ii
In the 2008 NLFS, 30.0 percent of the total current economically active population was classified as underutilised (49.9 percent in urban areas and 26.9 percent in rural areas). For males, 32.2 percent of the economically active were underutilised and for females, 22.8 percent of the economically active were underutilised. The labour underutilisation rate was highest for the 20-24 years age group (46.0 percent). UNEMPLOYMENT NLFS I estimated that 178.0 thousand people aged 15 years and above were classified as currently unemployed. This corresponded to an unemployment rate of 1.8 percent. The NLFS-2008 has estimated a total of 252.8 thousand persons aged 15 years and above to be currently unemployed in Nepal, an increase of 42 percent over the decade. The current unemployment rate increased slightly from 1.8 percent in 1998/99 to 2.1 percent in 2008, mainly for females aged 15 years and above (changing from 1.7 percent to 2.0 percent). Urban and rural unemployment rates were unchanged over the decade. The male unemployment rate (2.2 percent) was slightly higher than the female unemployment rate (2.0 percent). The unemployed rate in the urban areas was 7.5 percent and that in the rural areas was just over 1.2 percent. The youth (15-24 years) unemployment rate was 3.5 percent for those aged 15-24 years. The comparable rates for those aged 15-24 years in urban and rural areas were 13.0 percent and 2.1 percent respectively. 15 years and above were usually unemployed. Between 1998/99 and 2008, the percentages of people classified as usually active and usually employed have remained remarkably stable. Out of usually employed people aged 15 years and above, share of currently employed is 97.7 percent, currently unemployed is 0.5 percent and currently inactive is 1.8 percent in 2008. This share respectively was 96.8 percent, 0.6 percent and 2.6 percent during the previous survey of 1998/99. SUBNATIONAL ESTIMATES OF EMPLOYMENT The labour force participation rate aged 15 years and above has remained relatively stable in all areas between 1998/99 and 2008, except in urban areas, the Hill belt and the Central development region. The labour force participation rate decreased in the urban areas (73.3 percent in 1998/99 to 67.3 percent in 2008) as compared to the rural areas where it remained stable (87.7 percent in 1998/99 to 86.8 percent in 2008). The labour force participation rate in the Hill belt fell from 87.9 percent in 1998/99 to 83.4 percent in 2008, and in the Central development region LFPR decreased from 83.4 percent in 1998/99 to 77.6 percent in 2008, whereas for other belts and development regions the labour force participation rate was relatively stable in the range 85 to 90 percent. It was also stable in the Terai at about 83 percent. The current unemployment rate increased in the Mountain belt and Far Western development region, but it was relatively stable elsewhere. USUAL ACTIVITY NLFS II estimates that about 82 percent of the enumerated population aged 15 years and above are usually active and 18 percent are usually inactive. The employment-topopulation ratio on a usual basis was 80 percent and 2 percent of the population aged INFORMAL SECTOR & INFORMAL EMPLOYMENT NLFS 2008 estimated that around 2142 thousand people aged 15 and over were currently employed in the non-agricultural informal sector (70 percent of total nonagricultural employment) as compared to 1657 Pre Liminary iii
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Executive Summary of Nepal Labor Force Survey – 2008 (II)

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