India’s labour market is undergoing a structural transformation, driven by digitalisation, the green energy transition, and the rapid expansion of gig and platform work. Against this backdrop, the Economic Survey 2025-26 notes that sustained government initiatives, combined with skilling efforts and rising entrepreneurship, are bringing down unemployment, expanding job creation, and extending welfare coverage across the workforce.
The Survey, tabled in Parliament by Union Finance Minister Nirmala Sitharaman, highlights that in the post-pandemic phase, policy emphasis has shifted from merely increasing the number of jobs to improving the quality, sustainability, and inclusiveness of employment. Recent measures targeting labour-intensive sectors, skills development, and regulatory reform reflect a renewed focus on human capital enhancement to fully harness India’s demographic dividend.
Current Employment Trends: Participation Rising, Unemployment Falling
The Economic Survey records a marked improvement in labour-market indicators:
- The Female Labour Force Participation Rate (FLFPR) increased from 23.3 per cent in 2017-18 to 41.7 per cent in 2023-24.
- The Unemployment Rate (UR) declined from 5.6 per cent to 3.2 per cent over the same period.
Data from the Periodic Labour Force Survey (PLFS) indicate that during April-September 2025 (H1 FY 2025-26):
- The unemployment rate under Current Weekly Status (CWS) declined
- Labour force participation stabilised
- Employment levels remained strong
In Q2 FY 2025-26, 56.2 crore people (aged 15 years and above) were employed, reflecting the creation of around 8.7 lakh new jobs compared to Q1 FY 2025-26.
Rural–Urban Employment Patterns
The Survey highlights clear sectoral distinctions:
- Rural employment is dominated by agriculture (57.7 per cent) and self-employment (62.8 per cent), with relatively higher female participation.
- Urban employment is concentrated in the services sector (62.0 per cent), with regular wage or salaried jobs accounting for 49.8 per cent of employment.
Manufacturing and the Self-Employment Shift
The Annual Survey of Industries (ASI) shows continued resilience in organised manufacturing:
- Employment in manufacturing grew by 6 per cent year-on-year in FY 2023-24, adding over 10 lakh jobs.
- Between FY 2014-15 and FY 2023-24, the sector added more than 57 lakh jobs, at a CAGR of 4 per cent.
At the same time, the Quarterly Bulletin of Unincorporated Sector Enterprises (QBUSE) highlights a growing self-employment and entrepreneurship trend, especially in rural India:
- The unincorporated non-agricultural sector comprises 7.9 crore establishments, employing 12.9 crore individuals.
- The share of working owners rose to 60 per cent in Q2 FY 2025-26, indicating a shift toward entrepreneurial activity.
- Women constitute 28.7 per cent of the workforce.
- Digital adoption is increasing, with enterprise internet use rising from 26 per cent in 2023-24 to 39 per cent in Q2 FY 2025-26.
Empowering Workers Through Digital Platforms
e-Shram: Extending Social Protection
The Survey identifies the e-Shram portal as a key institutional mechanism for integrating unorganised workers into welfare and skilling systems.
- As of January 2026, over 31 crore unorganised workers are registered.
- Women account for 54 per cent of registrants, strengthening gender-focused welfare delivery.
The portal supports linkages to jobs, apprenticeships, and skilling programmes, facilitating transitions to better employment outcomes.
National Career Service (NCS): Mobilising Jobs at Scale
The National Career Service (NCS) portal, launched in 2015, has emerged as a central employment facilitation platform:
- 5.9 crore job seekers and 53 lakh employers registered
- Around 8 crore vacancies mobilised since inception
- Over 200 per cent growth in vacancies in FY 2023-24 compared to FY 2022-23
- 2.8 crore vacancies mobilised in FY 2024-25
- More than 2.3 crore vacancies mobilised in the first six months of FY 2025-26
The NCS portal is integrated with e-Migrate (for overseas employment), Skill India Digital Hub (SIDH), and 30 State employment portals, enhancing reach and matching efficiency.
Labour Codes: Balancing Welfare and Ease of Business
The Economic Survey underscores the significance of the four Labour Codes, notified on 21 November 2025, which consolidate 29 central labour laws. The Codes aim to balance worker welfare, social security, and labour-market flexibility, while improving ease of doing business. The Survey notes that effective implementation will depend on:
- Coordination with States
- Investment and system upgrades by the private sector
- Enhanced digital readiness and workforce re-structuring
Gig Economy: A Rapidly Expanding Frontier
The Survey highlights the structural rise of gig and platform work:
- Gig workers increased from 77 lakh in FY 2020-21 to 120 lakh in FY 2024-25, a 55 per cent rise.
- The sector now accounts for over 2 per cent of India’s workforce.
Driven by over 80 crore smartphone users and around 15 billion UPI transactions per month, the gig economy is projected to:
- Account for 6.7 per cent of the non-agricultural workforce by 2029-30
- Contribute ₹2.35 lakh crore to GDP
Gender Dimensions and the Case for Flexible Work
Drawing on the Time Use Survey (TUS) 2024, the Survey highlights the gendered nature of work:
- 41 per cent of women aged 15-59 participate in caregiving, compared to 21.4 per cent of men.
- Women spend significantly more time on unpaid work, even when engaged in paid employment.
This dual burden explains the growing demand for flexible work arrangements, reinforcing the need for flexi work hours and adaptive employment models as female labour force participation rises.
Conclusion
The Economic Survey 2025-26 concludes that right skilling, entrepreneurship, labour reforms, and digital employment platforms are jointly reshaping India’s labour market. Falling unemployment, rising female participation, expanding self-employment, and wider social protection signal a more inclusive, resilient, and future-ready employment ecosystem. (Source: PIB PR ID 2219940)
Economic Survey of India 2025-26 dated 29/01/2026