India's jobless rate eases in July, but gender and urban gaps persist

New Delhi: India’s unemployment rate for those aged 15 years and above eased to 5.2% in July from 5.6% in June, offering modest relief in an uneven labour market.

The improvement was driven by rural areas, where unemployment fell to 4.4% in July from 4.9% a month earlier, according to the latest Periodic Labour Force Survey (PLFS) released on Monday.

In contrast, urban unemployment inched up to 7.2% from 7.1%, underscoring persistent strain in city labour markets, data from the Ministry of Statistics and Programme Implementation showed.

Women remained disproportionately affected, though trends diverged across regions. In urban India, unemployment among women declined to 8.7% in July from 9.1% in June, even as joblessness among men rose to 6.7% from 6.4%. 

In rural areas, unemployment eased for both men and women, to 3.9% from 4.4%.

“In terms of employment status, self-employment dominated in rural areas, while regular wage/salaried employment was predominant in urban areas,” the survey said.

The agriculture sector engaged the majority of rural workers, while the tertiary or service sector was the largest source of employment in urban areas, it said.

On average, 564 million people aged 15 years and above were employed in the country during the April-June quarter. Of them, 397 million were men and 167 million were women.

Deep imbalances

The latest employment data underscore the dual challenge facing India’s labour market: robust male participation coupled with persistently low female participation, and higher engagement in rural areas than in cities, a pattern that continues to weigh on the country’s employment landscape.

The labour force participation rate (LFPR) showed only marginal gains and continued to highlight deep structural imbalances. 

Overall LFPR in July rose to 54.9% from 54.2% in June. Male labour force participation held steady at 77.1%, while female participation edged up to 33.3% from 32%. Rural LFPR remained stronger at 56.9% against 50.7% in cities. 

Among youth aged 15-29 years, participation was especially weak, with only about one in five women active in the labour force in either rural or urban India.

The worker population ratio (WPR), which tracks the share of people employed, mirrored these divides. In July, the WPR for those aged 15 and above was 52%, with men at 73% and women at just 31.6%. 

Rural workers fared better than their urban counterparts, at 54.4% versus 47%. Young women were particularly under-represented, as only 17.6% of those aged 15-29 were employed nationwide.

Revamped framework

The statistics ministry said the findings were based on an extensive household survey.

In July, 7,519 first-stage units (FSUs) were surveyed nationwide, spanning 89,505 households and 379,222 individuals, split across rural and urban areas.

FSUs are the primary units selected for sampling in a multi-stage survey design.

The ministry has revamped the PLFS framework to provide timelier data. Starting with the April bulletin, the ministry began releasing monthly estimates of key labour market indicators, LFPR, WPR, and unemployment rate at the all-India level using the current weekly status approach.

The number of households to be surveyed within a selected FSU was increased from eight to 12, it added.