Union Labour and Employment Minister Mansukh Mandaviya’s recent claim of the country’s unemployment rate being the lowest among the G20 nations at two percent seems to lack credibility as per the records available with various government and non-government agencies connected with the matter. Mandaviya’s reference to India’s low unemployment rate came during his address before a gathering on the occasion of signing of MoUs between his ministry and digital mentorship platform ‘Mentor Together’ and classifieds online site ‘Quikr’ for enhancing employment opportunities and well as youth employability on the National Career Service portal.
Mandaviya’s labour and employment ministry may not be fully aware of the survey records on the subject by another government department, the Ministry of Statistics and Programme Implementation (MoSPI), which recorded a much higher figure of unemployment for last year at 3.2 percent. The variation between the two figures is as high as 60 percent. The Periodic Labour Force Survey (PLFS} data shows that India’s official unemployment rate for 2024 was 3.2 percent, representing a slight increase from the previous year’s level of 3.1 percent. The higher unemployment rate was largely attributed to a modest decline in the female Labour Force Participation Rate, while the male participation rate showed a slight growth.
The PLFS data shows that while the overall unemployment rate was 3.2 percent, the labour force participation rate (LFPR) declined to 59.6 percent and the female LFPR dropped to 40.3 percent from 41.3 percent in the previous year. The male LFPR was up from 78.3 percent to 79.2 percent. The PLFS is a key survey by the Ministry of Statistics and Programme Implementation. Its methodology is based on the principal and subsidiary status, providing a different picture than the Current Weekly Status (CWS), which saw a drop in unemployment to 4.9 percent in 2024. The data shows varied trends across regions and genders, with an overall decrease in rural unemployment, but a fall in female participation, particularly in rural areas.
It may also be noted that the International Labour Organisation (ILO) found a drop in India’s overall unemployment rate in 2024, though reports vary on the exact figure and the trends for men and women. The ILO report highlighted a declining real wage for regular and self-employed workers, while the formal sector witnessed increased youth employment and more women joining the workforce. The eShram portal initiative continues to build a database for unorganized workers and integrate social security schemes, with over 30.5 crore workers registered by December 2024.
The eShram portal is a central hub for integrating various social security schemes. Among the key takeaways from the ILO Report are: net additions to EPFO (Employee Provident Fund Organisation) subscriptions, signalling a shift towards formal employment; young people (under 29) accounting for a large portion of the net payroll additions in the organised sector; notable increase in the Female Labour Force Participation Rate (FLFPR); higher proportion of self-employed workers, indicating a trend toward entrepreneurial activities and flexible work; and stagnated or declined real wages for regular and self-employed workers, with only casual labourers seeing a modest upward trend.
The contradictory unemployment figures still don’t explain the growing numbers of India’s jobless people who are provided with only a 100-day job guarantee in a year. The minimum average daily wage rate under the programme was only Rs.279 in 2024-25. It is not clear what happens to those job seekers during the remaining 265 days of a year? Where do they find employment? How many more days do they manage to work? During the last financial year, the government allocated Rs.86,000 crore for the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), the highest budget estimate in the scheme’s history. In the first five months of the financial year, nearly 60 percent of the budget was consumed indicating the high demand for such low-paid jobs.
On the other hand, the Centre for Monitoring Indian Economy (CMIE), one of the country’s leading non-government organisations, provides a totally different picture of unemployment in India. The CMIE estimates India’s current unemployment rate at 7.1 percent. According to the CMIE data of monthly unemployment rate, it was 7.6 percent in March, 7.7 percent in April, 6.9 percent in May, 6.8 percent in July and 7.1 percent in August, this year. Reporting the recent employment trends, the CMIE said that during March, this year, the Indian labour market shrank, with an estimated 4.2 million people either losing their jobs or stopping their search for employment. The rise in unemployment seen during last June was concentrated in rural India. The unemployment rates keep fluctuating. For instance, in June, last year, the unemployment rate went up to 9.2 percent driven by issues in both rural and urban sectors, and later a slight decline by November to eight percent.
In fact, the recent CMIE data shows even a much higher state of joblessness. It says that as many as 44.5 percent of Indians aged in the 20–24 bracket are unemployed, despite many of them holding graduate or even postgraduate degrees. According to the ‘India Skills’ Report 2025, only 54.8 percent of Indian graduates are considered employable. Contrasting official and independent data on unemployment often obscure the true extent of the problem. Unfortunately, the unemployment data from various government agencies seem to undermine the gravity of the serious and complex problem. Little is mentioned about the severe youth unemployment or underemployment. The unemployment rate for youth aged 15–29 stood at 15.3 percent in June 2025. The urban youth unemployment rate reached 18.8 percent. A report last May found that many unemployed youths have become “discouraged workers” and stopped looking for jobs altogether. In 2023, the jobless rate for graduates was 29.1 percent, compared to just 3.4 percent for those who could not read or write.
New jobs in the organised sector are few. The job market is being increasingly dominated by the informal economy where much of the workforce operates with low wages and poor job security, leading to high levels of underemployment or disguised unemployment. The large and fluid informal sector makes accurate unemployment measurement practically impossible. Surprisingly, the official data provides a totally different picture projecting high acceleration of employment creation with 4.67 crore jobs in 2023-24 and the pace of job creation continuing through 2024-25, with growth observed in both formal and informal sectors. This is despite the fact India’s Employees’ Provident Fund Organisation (EPFO) registrations are falling. The matter is quite confusing. The job data from various sources, official and non-government, are simply not tallying. Maybe it’s time that Employment Minister Mansukh Mandaviya makes a statement on the subject in Parliament to provide a somewhat reliable picture of the country’s unemployment situation. (IPA Service)