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This article examines the impact of nationwide lockdown on the Indian labour market, restricted to the first wave of the Covid-19 pandemic. As a result of lockdown, both labour supply and labour demand contracted sharply; moreover, we find evidence of discouraged worker effect. An analysis of the demand side of the labour market shows an unequal impact of lockdown on different segments (region, gender, and caste) of the workforce. There is also a marked deterioration in the quality of employment and wages/income. In this context, we found the policy response of the Union government inadequate and far from satisfactory; as a result, labour market recovery was uneven and stunted.

The great Indian lockdown 1.0: exploring the labour market dynamics