KOCHI: Demonetisation has jolted the employment sector in Kerala massively. As per the latest unemployment data of the Centre for Monitoring Indian Economy (CMIE), the rate stands at 18.7 percent - second highest after Delhi. The rate in November was 15.7 percent. The situation is quite embarrassing as the Economic Review - 2015 states that Kerala has the largest chunk of unemployed people in the country - 7.4 percent. Real estate and tourism - the largest employment providers in the state - were badly hit by demonetisation, thwarting employment opportunities.
“The economic activities in Kerala are limited to a few areas, restricting the revenue avenues of the government. The falling tax revenue of the government post demonetisation clearly shows that the tax revenue is skewed towards certain sectors. We don’t have any alternative to compensate the loss. Demonetisation has only aggravated this crisis,” said Deepthi Mary Mathew, research associate, Centre for public policy Research. The size of construction and real estate sectors in Kerala stands around `1,35,620 crore. Deepthi said the transactions in the above sectors have come to standstill post demonetisation and it can have a negative impact on the growth of economy.
As per the 2016 budget, total tax revenue of Kerala is estimated at Rs 47,613.61 crore for the financial year 2016-17 with sales tax/VAT having the highest share - around 80 per cent. Demonetisation has affected the consumer sentiments and this would reflect in the tax receipts of the state. According to CMIE data, September (4.2 percent) and October (0.9 percent) recorded the lowest unemployment in 2016. In February and March, the figure was high because many youth joined the existing workforce.
“Tourism sector employs 15-18 lakh people in Kerala directly and indirectly. After demonetisation, the sector is in deep crisis and many small shops have already been closed. The revenue is down by 30 percent. If this situation prevails (which is likely to happen) more job loss will happen,” said Abraham George, chairman of Intersight Tours and Travels, the largest tour operator in the state.