Unemployment Rate Falls to 3.2% in 2022-23 as Indian Labour Market Improves, reports Economic Survey
States like Tamil Nadu, Gujarat, and Maharashtra are leading in factory employment, while states with a younger population, such as Chhattisgarh, Haryana, and Uttar Pradesh, have seen the highest employment growth
Unemployment Rate Falls – Indian Labour Market – Economic Survey – taxscan
Unemployment Rate Falls – Indian Labour Market – Economic Survey – taxscan
India has seen improvements in labour market indicators over the past six years, as reported in the Economic Survey 2023-24 presented by Finance Minister Nirmala Sitharaman. According to Periodic Labour Force Survey ( PLFS ) data, the unemployment rate declined to 3.2% in 2022-23. The Survey noted the government’s focus on generating employment opportunities to harness the country’s demographic dividend.
According to the survey presented, States like Tamil Nadu, Gujarat, and Maharashtra are leading in factory employment, while states with a younger population, such as Chhattisgarh, Haryana, and Uttar Pradesh, have seen the highest employment growth.
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Government initiatives, such as the Production Linked Incentive (PLI) scheme and increased capital expenditure, have boosted employment generation and worker welfare. The National Career Service (NCS) Portal, e-Shram portal, and Aatmanirbhar Bharat Rojgar Yojana (ABRY) are notable efforts to promote job creation and support workers post-COVID-19.
Several factors, including economic reforms, technological advancements, and skill development initiatives, have driven this positive transformation in employment. The all-India annual unemployment rate has been declining since the pandemic, with a corresponding rise in the labour force participation rate ( LFPR ) and worker-to-population ratio (WPR). Notably, the female labour force has shifted towards self-employment, particularly in agriculture, boosting the female LFPR, reported the Survey 2023-24.
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Youth employment has improved significantly, with the unemployment rate for those aged 15-29 dropping from 17.8% in 2017-18 to 10% in 2022-23. The majority of new EPFO payroll subscribers are from the 18-28 age group, mentioned in the survey.
The Survey highlighted a continuous rise in the female labour force participation rate over the past six years, attributed to higher agricultural output and improved access to basic amenities. Rural wages have also grown, with a 6.9% CAGR from FY15 to FY22, surpassing urban wage growth.
The Survey also noted that in FY24, rural wages rose above 5% year-on-year, with nominal wage rates in agriculture growing by 7.4% for men and 7.7% for women. Non-agricultural wage growth was 6.0% for men and 7.4% for women. With expected easing of inflation, real wages are anticipated to rise sustainably.
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