PLFS 2025 and India’s Labour Market Transformation

Context

The latest labour market findings from the PLFS 2025 reveal steady improvement in employment indicators, while also drawing attention to persistent structural bottlenecks that could limit India’s demographic advantage.

What is the Periodic Labour Force Survey (PLFS) 2025?

Objective

  • Conducted to assess employment and unemployment trends in India through quarterly urban surveys and annual nationwide estimates.
  • Tracks major indicators such as labour participation, employment levels, and unemployment trends.

Published by

  • Ministry of Statistics and Programme Implementation (MoSPI).

Coverage

  • Covers individuals aged 15 years and above.
  • Uses two approaches:
    • Usual Status – Employment condition over the previous 365 days.
    • Current Weekly Status (CWS) – Employment situation during the last 7 days.

Major Indicators

  • Labour Force Participation Rate (LFPR) – Share of population either employed or seeking jobs.
  • Worker Population Ratio (WPR) – Proportion of population currently employed.
  • Unemployment Rate (UR) – Percentage of labour force without employment.
  • Usual Activity Status – Measures long-term labour engagement.
  • Current Weekly Status – Captures short-term labour activity.

Positive Trends in Employment

Improvement in Labour Market Indicators

  • LFPR reached nearly 59%.
  • Worker Population Ratio increased to around 57%.
  • Unemployment declined to nearly 3%.

Decline in Youth Unemployment

  • Rural and urban youth unemployment witnessed moderation compared to 2024 levels.
  • Better labour absorption among young workers has been observed.

Rise in Women’s Labour Participation

  • Female labour participation, especially in rural regions, continued to improve through 2025.
  • Women’s LFPR touched its highest level in recent years.

Entry of Educated Workforce

  • Around 7–10 million youth enter the labour market annually.
  • New entrants possess higher educational attainment and skill aspirations.

Shift Towards Better Quality Jobs

  • Share of regular salaried employment increased from 22% to 24%.
  • Self-employment witnessed a marginal decline.
  • Expansion of formal jobs indicates improved access to job security and social protection benefits.

Wage Growth Trends

  • Women’s earnings growth surpassed men across several categories:
    • Salaried work – 7% growth for women.
    • Self-employment – 9% rise for women.
    • Casual labour – Female wages improved while male wages remained largely stagnant.

Persistent Gender Wage Gap

  • Women continue to earn substantially lower wages than men:
    • About 76% of male earnings in salaried jobs.
    • Around 69% in casual labour.
    • Nearly 36% in self-employment.

Structural Economic Transition

  • Agriculture’s employment share declined to nearly 43%.
  • Manufacturing and services expanded steadily.
  • Young workers, especially women, are increasingly entering non-farm sectors.

Improving Social Mobility

  • Younger generations face relatively lower caste and gender barriers in employment.
  • Expansion of education and urban opportunities has improved inclusiveness.

Challenges in Employment Generation

Weak Education-to-Employment Link

  • Higher education enrolment has expanded significantly.
  • However, job absorption remains limited compared to the number of graduates entering the workforce.

Limited Skill Development

  • Only a small proportion of people aged 15–59 possess formal vocational or technical training.
  • Skilled individuals show significantly higher workforce participation rates.

Structural Constraints on Women

  • Men outside the labour force mostly cite education.
  • Women largely cite childcare and domestic responsibilities.
  • Unequal unpaid care burden continues to limit women’s economic participation.

Gendered Work-hour Disparity

  • Men spend substantially more hours in paid work compared to women.
  • Women continue to face a dual burden of paid and unpaid work.

NEET Population Challenge

  • Around one-fourth of youth aged 15–29 fall under NEET (Not in Education, Employment or Training).
  • Many are excluded from unemployment estimates because they are no longer actively seeking work.

Long-term Economic Risks

  • Prolonged disengagement from employment may reduce productivity, incomes, and economic growth potential.

Future Outlook for India’s Labour Market

Narrow Demographic Dividend Window

  • India’s working-age population is expected to peak before beginning to decline after 2030.
  • This creates urgency for labour market reforms and job creation.

Emerging Global Transitions

  • Artificial Intelligence is transforming skill requirements.
  • Green economy transition is altering employment patterns.
  • Global supply chain realignments are creating new opportunities.

Current Trends are Encouraging

  • Labour markets are gradually formalising.
  • Wage growth and employment opportunities are expanding for women and youth.

Way Forward

Expand Industry-linked Skill Training

  • Promote vocational education and apprenticeship-based learning.

Strengthen Women-centric Policies

  • Improve childcare support, workplace safety, and flexible employment opportunities.

Promote Stable and Formal Employment

  • Expand social protection coverage and encourage formal sector jobs.

Focus on Green and Future-ready Jobs

  • Invest in renewable energy, digital economy, and advanced manufacturing sectors.

Re-engage NEET Youth

  • Targeted apprenticeship and employability programmes are essential to bring disengaged youth back into productive employment.

Source : The Hindu

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top