Uncovering India’s Job Spread: What the Periodic Labour Force Survey (PLFS) Reveals

PLFS Exposes India’s Employment Gaps

Although India's GDP growth has averaged 7-8% in the last few years, which is quite a good thing. But the job market of India is describing a different picture. Notably, Indian sectors such as finance, IT, and others like real estate have been hiring very few professionals over the past period. While it appears that the agriculture sector has employed a significant portion of India's youth, it still accounts for less than 50% of the country's total population. Furthermore, contributions to GDP growth have not had a significant impact.

This situation is known as jobless growth. In straightforward terms, this means that despite economic growth, it is insufficient to meet India's growing job demands because the youth are not getting well-paying, decent professional jobs as per their educational qualifications. And then as a result, either most people are entering into informal sectors or taking up casual work, neither seeking self-employment opportunities where employees do not receive formal salaries.

To understand the current state of employment in India, we have chosen the Periodic Labour Force Survey (PLFS). PLFS is an important data source managed by the National Statistical Office (NSO). It provides crucial data that helps us to understand the current state of employment, including unemployment rates, types of work and nature of employment. It also enables us to analyse the workforce's composition, gender disparities and age-wise distribution of workers, offering a comprehensive picture of the employment landscape.

• Unemployment has reached a point where very talented and educated young men of India are struggling to secure a good job.

• Despite female education having seen a significant increase in India, women are still facing stiff competition in the job market, even with a good degree. Moreover, in rural areas, women are facing additional challenges due to traditional and cultural norms that hinder their progress.

This “jobless growth" phenomenon is having an impact, and let's take a look at why and how much it is a cause for concern - 

Unemployment Trends: What the PLFS Data Show (April - June 2025)

The periodic labour force survey from April 2025 to June 2025 has been the current employment landscape and trends in India. According to the data, the overall unemployment rate for April has increased to 5.1% (for individuals aged 15 and above). A clear divide is evident between urban and rural areas, with urban regions facing a higher rate of 6.5% compared to 4.5% in rural areas, indicating increased pressure on urban job markets.

Before May was over, the unemployment rate had risen to 5.6%. During this time, rural unemployment increased slightly by 4.9% while unemployment in urban areas reached 7.1 %.

In June, unemployment among youth (aged 15 to 29 years) increased, with urban youth facing a rate of 18.8% and rural youth facing a rate of 13.8%.

Labour force participation is gradually declining, as the overall Labour Force Participation Rate (LFPR) fell from 55.6% in April to 54.8% in May 2025. Urban LFPR stood at 50.4%, while rural LFPR was higher at 56.9%. The Worker Population Ratio (WPR) also dropped to 51.7% (from 52.8%). Notably, the female unemployment rate rose to 5.8%, slightly above the male unemployment rate of 5.6%.

The figures indicate deep structure and issues that warrant attention about the current situation. The current scenario shows youth unemployment persisting, labour force participation is declining, and gender disparities are growing. These findings suggest the policies to revive employment opportunities and bring stability to the labour market.

Informal work: How Precarious are India's Jobs?

The Indian job market is so unprofessional that nearly 90% of people earn their livelihood without any security, including those in non-jobs such as factories, offices, and shops, with most lacking contracts, paid leaves or benefits.

As per PLFS (JULY 2023 - JUNE 2024), the workforce has been classified as follows:

• Self-employed: 58.4%

• Permanent employee: 21.7%

• Casual labour: 19.8%

Among the salaried employees 58% have no return contract and 53% have no social security benefits. However, self-employment arrangements conceal their vulnerabilities, and 94% of self-employed individuals do not employ anyone else. Yes, that's why among the self-employed, 18.3% are contributing to family work without receiving a salary (up from 13.6% in 2017-’18).

Earnings remain low:

• Self-employed: ₹13,300/ month

• Regular employees: ₹20,700/month 

• Casual Workers: ₹400/day(₹299/day for women)

Now, the actual income has either stagnated in many places or has come to a standstill. Despite ongoing inflation, the monthly earnings from self-employment have decreased. According to the 2023 to 2024 report, average monthly income from self-employment has dropped from ₹14,800(2017-2018) to ₹13,279. In informal workplaces, women face increased workload burdens. Around 65% of women are in self-employment, with about 38% of them contributing unpaid labour. This fact reveals that the Indian challenge extends beyond just finding a job. The bigger issue is job sustainability and receiving payment. We need to understand and formally implement policies to address these concerns.

Youth & Women: Joblessness & Low Participation Explained

One of the major problems with employment in India is not just the scarcity of jobs, but also the large-scale exclusion of youth and women from the labour force. In 2025, youth, particularly those between 15 to 29, faced acute unemployment. In April, it was 17.2% and in June, it became 18.8% and nearly 1 person out of 5 couldn't find a suitable job.  Even rural youth unemployment rate increased from 12.3% 13.8% in just 2 months.

According to the PLFS from October to December 2024, the overall youth unemployment rate stood at 16.1%. In contrast, the unemployment rate among young women was 21.4%. The situation is even more concerning for women overall. In April 2025 Delhi war force participation rate for women aged 15 and above was only 34.2%, whereas for men it was 77.7%. Not surprisingly, the situation in urban areas is even worse. Only 20.5% of women were able to secure a place in the workforce. The Worker Population Ratio (WPR) shows that women's participation stands at 24.9% approximately half that of men's participation, which is 52.8%.

Currently, the urban female unemployment rate has reached 8.7% which is nearly double the rate for men at 5.8%. The young urban women have risen by 7%, highlighting significant underlying structural issues.

These disparities came from social pressures (marriage, motherhood), mismatch between skills and job requirements and biases in urban practices and especially for educated women. The data highlights that if India wants to achieve impressive growth, then it cannot afford to ignore its young and women's workforce.

Formal Sector Gaps: Why Isn't Modern Industry Absorbing Workers?

Despite India's growing GDP, the formal sector isn’t creating enough quality jobs. PLFS 2023–24 shows only 11.4% of workers are in manufacturing, still below pre-COVID levels. Instead of shifting to industry, more people are moving back to agriculture, which now employs 46.1% of the workforce, despite contributing just 11% to GDP.

One major issue is firm size: over 57% of non-farm workers are employed in tiny firms with fewer than 5 people, limiting formal job creation. Even among salaried workers, 62% lack written contracts, and more than 50% receive no benefits, highlighting widespread informality.

The skills gap is another barrier. Many companies report shortages of trained workers, even as unemployment among educated youth remains high. Automation and tech-driven models further reduce the need for human labour, especially in capital-intensive industries.

Low wages add to the problem - 80% of Indian jobs pay under ₹20,000/month, which discourages workers from formal sector transitions.

To bridge this gap, India needs policy reforms that promote enterprise growth, formal hiring, and skill alignment. Without this, modern industry will continue to fail at absorbing India's vast and growing workforce, leaving millions stuck in insecure, low-paid, informal work.

Bridging the Gap Between Growth and Jobs

India’s employment landscape represents a different scenario where strong GDP growth is paired with weak, uneven job creation. The PLFS data from 2023-2025 highlights deep-rooted structural challenges such as rising urban and youth unemployment, declining labour force participation, and widening gender disparities. A large portion of the workforce remains confined to informal, insecure, and poorly paid jobs. Meanwhile, the formal sectors- especially manufacturing and services- have failed to absorb the expanding labour pool, owing to skill mismatches, automation, and the dominance of small, low-scale enterprises.

Despite progress in education, particularly among women, female workforce participation remains low, held back by social norms and unequal workplace access. Agriculture, often the last resort for employment, cannot bear this burden alone. The outcome is widespread underemployment and jobless growth. To change course, India must implement targeted reforms- from expanding formal sector jobs and investing in practical skills to ensuring gender equity and promoting inclusive growth. Without immediate intervention, the divide between economic growth and quality employment will deepen, weakening the nation’s demographic advantage.