Employment status of India


  • As per Employment-Unemployment Survey (by NSSO) of 2011-12 (latest available), total workforce employed stands at 47.36 crore; with 23.16 crore in agriculture and 24.2 crore in industry and services
  • According to the fifth Annual Employment-Unemployment Survey (EUS) conducted between April and December 2015, 83% of the workers in India were self-employed, casual or contract workers.
  • As per Economic Census, 2013-14 (latest available), total workforce employed in all establishments stands at 13.1 crore. Further, own-account enterprises (OAEs), which do not employ any regular workers, and enterprises with < 10 workers together accounted for almost 79% of India’s workforce
  • Beginning from 2017-18, the NSSO has launched periodic labour force surveys (PLFS) to produce annual estimates of formal employment in the economy. This would also help India to meet the IMF’s Special Data Dissemination Standards (SDDS) for releasing quarterly data on macroeconomic indicators
  • In April 2018, for the first time, India released report on monthly payroll for the formal sector to facilitate analysis of new and continuing employment, based on EPFO’s, ESIC’s and (NPS) PFRDA’s payroll data and subscriptions. The period between September, 2017 and February, 2018 was covered and reported 31.10 lakh new additions across all age groups (those in the 18-25 age group, considered a proxy for new jobs, amount to 18.5 lakh). The payroll data from these three organisations would now be released every month (see box)
  • Report of the NITI Aayog’s Task Force on Improving Employment Data was released in 2017 (discussed later)
  • Committee under Dr. T.C.A. Anant, former Chief Statistician of India, is also examining various approaches with a view to reducing redundancy and avoiding duplication of efforts in estimation of employment through the establishment approach. It will also look into whether the monthly payroll data released by EPFO, ESIC and PRFDA can replace the quarterly enterprises-based survey on job creation by the Labour Bureau.


Features of Employment

  • A study on the employment types and the living style of people gives an information on the following areas −
  • National income
  • Employment structure
  • Management of human resources, etc.
  • The study helps us analyse the different levels of employment and the levels of income generated by different sectors that contributes to the national income.
  • On the basis of employment study, we can address the persistent social issues such as poverty, child labour, exploitation, etc
  • When we calculate all the goods and services produced in a year, it is known as Gross Domestic Product (GDP).
  • When we add all the earning of exports and deduct the amount paid for import, the final number is known as Gross National Product (GNP).
  • If the export is greater than the import, then the GNP’s measurement is on positive side and if the export is lesser than the import, then it is on negative side.

Seasonal Unemployment

  • Employment in India is multifaceted. There are people who are permanently unemployed; and there are people who are temporarily employed or temporarily unemployed (known as seasonal unemployment/employment).
  • On the other hand, a task that requires only 5 workers to handle it, is being handled by 12 workers. This condition is known as disguised unemployment.
  • Among all the workers of the country −
  • 70 percent of the workforce are men.
  • Three-fourth of the workforce is from rural areas.
  • Women workers account to one-fifth of the total workforce (in urban areas).
  • Population refers to a group of people living in a given area in a given time period.
  • As per the 2009-10 data, about 39 persons of every 100 persons, are employed.
  • In urban areas, the number of employed people is 36 per 100 persons, whereas, it is about 40 per 100 persons in rural areas.
  • People in the urban areas are more literate, and they have more options to look out for a permanent job. This could mainly be the reason for this gap.
  • The number of female workers in rural areas (25/100 women) is more than in urban (15/100 women) areas.
  • The income of the male counterpart in the urban areas is high. Hence, the need for a female member of a family to go and earn does not arise,
  • The disparity between self-employed workers and salaried workers is also high.
  • In India, there are more number of men as salaried workers than women.



Report of the NITI Aayog’s Task Force (released in 2017) made recommendations to create a 21st century statistical system in India for the generation of comprehensive employment, unemployment and wage estimates on a sustained basis. These include:

  • Conduct of household surveys on annual basis.
  • Introduction of time-use survey, that be conducted every three years (such surveys also help in measuring women’s participation in unpaid work).
  • Use of technology for faster and better data collection, processing and assimilation.
  • Introduction of annual enterprise survey using enterprises registered with the GSTN as the sample frame.
  • Separate annual survey of enterprises excluded from the GSTN database (i.e. those in health and education sectors, and those with turnover < INR 20 Lakh in other sectors).
  • Adoption of inclusive and wider definition of ‘formal workers’.
  • Adoption

Changes in the Structure of Employment


  • Slow growth of employment has been a remarkable feature of economic change in India during the post-liberalisation period. Economic growth over this period has been highly uneven across different sectors and regions. The rate of growth of agriculture and manufacturing sectors has been sluggish for most part of the postliberalisation period. Growth, even in periods during which it increased, was driven primarily by the service sector. It has been primarily located in urban, particularly metropolitan, areas. Trade and foreign investment have played only a marginal role as drivers of economic expansion. Benefits of economic growth have accrued differently across classes, resulting in a sharp increase in economic inequalities.
  • Not only has the average employment growth over this period has been low, the uneven pattern of growth has resulted in considerable changes in the structure of employment. There has been a considerable contraction in generation of employment in agriculture since the second half of 2000s. The Mahatma Gandhi National Rural Employment Guarantee Act Programme (MGNREGA) was introduced in the mid-2000s with a promise of providing a guarantee of 100 days of employment to each rural household. Although that promise has never been met, the programme resulted in some increase in availability of employment in rural areas particularly in the initial years of its implementation. On the other hand, an increase in schooling attendance rates among children, albeit slow, is also said to have resulted in withdrawal of a section of younger people from the labour force.



  • As outlined in the NITI Aayog’s Action Agenda, India suffers more from the problem of underemployment (i.e. low-productivity, low-wage jobs) than unemployment as for example:
  • In 2011-12, agriculture engaged nearly 50% of the workforce but contributed 15% to GDP
  • In 2010-11, within manufacturing, small firms employed 72% but output was only 12%
  • In 2006-07, in services sector, MSMEs employed 98% of workforce but produced 62% of services


  • Opportunities for creation of well-paying and high productivity jobs:
  • Expansion of the organized sector to create well-paid high productivity jobs o Shift towards labour-intensive goods and services e.g. apparel, footwear, food processing, tourism etc.
  • Expansion in export market by developing Coastal Employment Zones, using better technology, and improving on quality to remain competitive
  • Leverage on economies of scale offered by exports market potential
  • Filling in for ageing workforce of China and also rising labour wages there
  • Reformation of labour laws (outlined in the next section)
  • Significant employment generation also takes place as a direct result of public investment in infrastructure and expenditure on government schemes. Such jobs, being more manual or non-cognitive, do add to the numbers but miss focus on de


Trend of Employments

  • The pattern of employment has changed over the last four decades.
  • The percentage of workforce in primary sector has decreased from 74.3% (in 1972—73) to 48.9% (in 2011—12).
  • The percentage of workforce in secondary sector has increased from 10.9 (in 1972—73) to 24.3 (in 2011—12).
  • The percentage of workforce in tertiary sector has increased from 14.8% (in 1972—73) to 26.8% (in 2011—12).
  • Similarly, the percentage of self-employed workers has come down from 61.4% (in 1972—73) to 52% (in 2011—12).
  • The percentage of regular salaried employees has gone up from 15.4% (in 1972—73) to 18% (in 2011—12).
  • The percentage of casual labourers has gone up from 23.2% (in 1972—73) to 30% (in 2011—12).
  • The workers working in a public sector or other enterprises who hire other workers to get the work done are known as formal workers.
  • On the other hand, the workers working in a primary sector (farmers, agricultural labourers), owners of small enterprises, are self-employed and do not hire workers. They are known as informal workers.
  • Formal workers account to only about 6% of the workforce in India, while the other 94% of the workforce are informal workers.
  • In the formal sector, only 21% of the workers are women.
  • On the other hand, in the informal sector, about 31% of the workers are women.
  • Unemployment in India is of different types.


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