Rural wages trailing inflation, govt needs to continue support: Report

Workers at a tea garden on the outskirts of Siliguri. File pic/AFP

Rural wage growth is trailing inflation and the government needs to continue policy support to help people in the mofussil areas, a credit information company said on Thursday. In a report, Crif High Mark observed that rural wages are unable to keep pace with rising inflation and sought continued interventions from the policy front on this.

"With rising rural inflation, decline in real rural wages and slowing rural demand, it is important for the government and policymakers to continue their support to the rural sector," it said. Rural inflation had remained above urban inflation in the first half of 2022, it said, adding that rural consumption declined and average rural unemployment decreased.

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"The government has focused on providing relief and credit flow to small business and other sectors that were affected by the pandemic. This has likely resulted in more positive macroeconomic outlook across industries in the rural sector," the report explained.

As per the survey, 70 per cent of respondents said government policies and schemes drove rural growth in 2022. It also said that a larger proportion of people (17 per cent in 2022 as against 7 per cent in 2021) expected a deterioration in the overall access to credit.

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