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India’s unemployment rate dropped to 23.97% on May 10 from 27.11% on May 3, as the government lifted some curbs on economic activity, including farming, after a month-long lockdown.

Unemployment Rate Survey results:


  • The urban jobless rate, on the other hand, declined more modestly, underlining the fact that cities are still struggling to recover as covid-19 cases continue to rise.
  • Urban unemployment declined to 27.83% in on 10 May from 29.22% on 3 May. However, the figure is still higher than the national job-loss rate of 23.97% and the rural job loss rate of 22.35%, according to CMIE.
  • The job loss and wage loss in cities in both the formal and informal segments is negating whatever little activity is taking place in urban centres and industrial clusters.


  • Rural unemployment rate declined four percentage points, indicating some farming activity has resumed during the harvest season.
  • The rural economy, which accounts for the largest share of the workforce, also saw a fall in the unemployment rate to 22.35% in the week to 10 May from 26.16% in the previous week, according to CMIE data.
  • However, some concerns exist that the rural unemployment rate may increase as millions of migrants stranded in cities make their way back to their home states.

Employment in the Indian Economy

  • In 2012, there were around 487 million workers in India, the second largest after China.
  • In 2018 reports show: Close to 81% of all employed persons in India make a living by working in the informal sector, with only 6.5% in the formal sector and 0.8% in the household sector.
  • Among the five South Asian countries, informalisation of labour is the highest in India and Nepal (90.7%), with Bangladesh (48.9%), Sri Lanka (60.6%) and Pakistan (77.6%) doing much better on this front.
  • Over 94 percent of India’s working population is part of the unorganised sector.
  • 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), and in addition there is disguised unemployment – which in simple terms is the condition where a task that requires only 5 workers to handle it, is being handled by 12 workers.
  • Agriculture, dairy, horticulture and related occupations alone employ 43 percent of labour in India. However, Agriculture and the allied sectors contribute only to 14.6% of India’s GDP!
Workforce Distribution Across Sectors in India
GDP Share Across Sectors in India

-Source: Livemint

March 2024