Fewer Indians Moving to Cities: Report Reveals A Surprising Discovery About Labour Migration

The Economic Advisory Council to the Prime Minister (EAC-PM) recently released statistics from a research called "400 Million Dreams!" that shows a decrease in India's rural-to-urban migration. According to the data, there have been 5.4 million fewer migrants, or 11.8%, than in 2011.

The decline is due to several reasons, such as enhanced government services and increased economic opportunities in rural areas.

Decline in India's Labour Migration Rate

In 2011, India's migration rate was 37.6%; by 2023, it had dropped to 28.9%. The number of workers migrating for economic reasons has dropped to 5 million, making up just 6.7% of the workforce. This represents a significant decline from 9.3% in 2011 and 8.2% in 1991 and 2001. While migration declined by -1 percent, the workforce has expanded at a compound annual growth rate (CAGR) of 1.8%.

Factors Behind Reduced Migration

According to the study, increased infrastructure, connectivity, and government services like health and education have all helped to reduce migration. The truth of this claim is dubious, nevertheless, evidence suggests that the labour movement has decreased in spite of these advancements.

Indicators of Reduced Economic Migration

The paper uses data from railway tickets to show that post-pandemic migration decreased by 6.7% during peak months. In addition, bus traffic has decreased by 16% since FY11. Another indicator of a decline in economic migration is the decline in the number of passengers on non-suburban trains.

The study evaluates urban-rural remittances by analyzing savings account to current account (SA/CA) ratios. Whereas smaller ratios show strong economic activity, higher SA/CA ratios show locations with outbound migration. In contrast to rural areas like Bihar, which have a high ratio of 10.14, major cities like Delhi and Mumbai have lower ratios, indicating increased economic activity.

Ruralization is the New Trend

According to the survey, the decrease in migration is more indicative of a growing tendency toward ruralization than urbanization. Increased reliance on agriculture has resulted in stagnating rural earnings and disguised unemployment. This tendency is a result of both increased automation and a decline in economic activity.

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