Unemployment and Economic Recovery Post-Pandemic: A Path to Reviving Nagaland’s Economy

Jan 30, 2025

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The COVID-19 pandemic has been a global tragedy, affecting millions of lives and economies worldwide. In Nagaland, like many other regions, the economic repercussions were felt deeply. Unemployment rates surged, and many sectors struggled to stay afloat. As we move forward into 2025, the question remains: how can Nagaland recover from the damage caused by the pandemic, especially in terms of job creation and economic growth?
The Impact of the Pandemic on Employment in Nagaland
Before the pandemic, Nagaland’s economy, though largely dependent on agriculture and small businesses, had been showing slow but steady progress. However, with the lockdown, travel restrictions, and disruptions to trade and industries, a significant portion of the population, especially in the informal sector, faced severe job losses. According to a report by the Centre for Monitoring Indian Economy (CMIE), the unemployment rate in India reached an all-time high of 23.5% in April 2020, with states like Nagaland being deeply affected due to the dependence on the informal sector.
Youth unemployment is particularly concerning in Nagaland, with many graduates finding it difficult to secure stable jobs. The pandemic exacerbated this issue, leading to a rise in disillusionment among young people. According to the Ministry of Statistics and Programme Implementation, India’s youth unemployment rate in 2020 was 23.3%, and Nagaland, with its young population, mirrors this national trend. As per the Nagaland State Economic Survey 2022, the state’s economy contracted by nearly 5% in the fiscal year 2020-21, worsening the situation for job-seekers.
The Road to Economic Recovery
While the pandemic presented immense challenges, it also presented an opportunity to rethink and rebuild the economy. Economic recovery post-pandemic requires a comprehensive approach that involves the government, businesses, and the local community working together.
1. Investing in Local Industries and Infrastructure: One of the key pillars of recovery for Nagaland lies in revitalising local industries, especially agriculture, tourism, and handicrafts, which are the backbone of the state. According to the Nagaland Economic Survey 2021, the state’s primary sector (agriculture and allied activities) accounts for nearly 25% of its GDP. Investing in agriculture, improving connectivity (e.g., roads and transport), and enhancing skill development programmes can create a more sustainable economy. The Nagaland Bamboo Development Agency (NBDA) has already recognised bamboo as a key resource for economic development and job creation. This can be leveraged further to enhance employment opportunities.

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2. Promoting Digital Transformation: The pandemic has highlighted the importance of technology in all sectors. From online education to e-commerce and telemedicine, the digital space has proven to be a vital tool for business continuity. According to the National Association of Software and Service Companies (NASSCOM), India’s digital economy is expected to grow to $1 trillion by 2025. By encouraging digital entrepreneurship and enhancing internet accessibility across the state, Nagaland can tap into these growing sectors. In 2022, India’s internet penetration reached 63%, and expanding this reach in Nagaland would foster a new wave of job creation, especially in IT and digital services.

3. Supporting Small and Medium Enterprises (SMEs): Small businesses were hit hard during the pandemic, and many continue to struggle. Providing financial support, tax relief, and skill development programmes for entrepreneurs can help revive these enterprises. According to a report by the Small Industries Development Bank of India (SIDBI), over 40% of SMEs in India were adversely affected during the pandemic, but the sector accounts for nearly 30% of India’s GDP and over 45% of total employment. Strengthening the MSME (Micro, Small, and Medium Enterprises) sector is crucial for creating job opportunities for the local population, particularly in rural areas, where most small businesses are based.

4. Tourism and Local Culture: Nagaland’s rich culture, natural beauty, and festivals are its unique assets. According to the Nagaland Tourism Development Corporation (NTDC), tourism contributes around 5-7% of Nagaland’s GDP. By investing in tourism infrastructure, the government can boost employment in the hospitality sector. Additionally, promoting cultural tourism, which emphasises local traditions, festivals, and crafts like weaving, wood carving, and hand-loom, can provide sustainable income opportunities for local artisans. In 2022, Nagaland’s Hornbill Festival attracted thousands of domestic and international visitors, providing a glimpse of the potential of tourism to fuel economic growth and job creation.

The post-pandemic recovery process requires strong collaboration between the government, private sector, and civil society. Public-private partnerships (PPPs) can lead to innovative solutions for employment generation. According to the NITI Aayog, India’s policy think tank, public-private partnerships have been a key driver in sectors such as infrastructure, education, and health, and their expansion could significantly aid recovery. Education and vocational training must align with market needs, equipping the youth with the skills that employers are seeking. Nagaland’s Employment and Crafts Development Agency (ECDA) has already been working towards providing skill training to youth, and this can be further expanded to meet industry demands.

TUESDAY, JUNE 30, 2026

Nagaland Districts

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