India’s unemployment rate declined in 2025, with improvements across rural and urban areas alongside a gradual shift towards salaried employment, according to the latest Periodic Labour Force Survey (PLFS). The survey indicates a broad-based easing of joblessness and evolving employment patterns across the country.
The survey shows that unemployment fell to 2.4 per cent in rural areas and 4.8 per cent in urban areas, compared with 2.5 per cent and 5 per cent, respectively, a year earlier.
The PLFS data indicate that the improvement was broad-based across different segments of the workforce. Unemployment among educated persons, defined as those with secondary education and above, declined to 6.5 per cent from 7 per cent. Similarly, the youth unemployment rate for those aged 15–29 years eased to 9.9 per cent from 10.3 per cent.
According to the survey, the Labour Force Participation Rate stood at 59.3 per cent in 2025, remaining largely unchanged from the previous year. The Worker Population Ratio was also steady at 57.4 per cent, suggesting that employment gains were driven more by improved absorption of workers into jobs rather than an increase in labour force participation.
The PLFS further shows a gradual shift in the structure of employment. The share of regular wage and salaried jobs rose to 23.6 per cent, up from 22.4 per cent a year earlier. At the same time, the proportion of self-employed workers declined to 56.2 per cent, continuing a downward trend from 58.2 per cent in 2023. These changes point to a gradual movement towards more formal employment arrangements.
Sectoral trends reflected in the survey suggest that employment growth has been supported by expansion in manufacturing, construction, and services. Increased economic activity and infrastructure development have contributed to job creation, particularly in urban areas.
Despite the improvement in key indicators, the PLFS highlights that challenges remain in ensuring sustained job creation and improving job quality. Informal employment continues to account for a significant share of the workforce, and differences across regions and demographic groups persist. |
