India’s labour market is changing, but the transition is not uniform. Over the years, employment has moved away from the agriculture sector towards non-farm activities and larger enterprises. Yet, agriculture continues to account for a major share of jobs, highlighting how it is still India's job market backbone.
The latest PLFS 2025 unit-level data by
SBI offers shows how the country’s workforce has shifted and its persisting inequalities. Gaps in the ecosystem are visible across gender, caste, geography and industry, shaping access to stable and better-paying work.
So where are workers actually spread across the economy right now? Here’s what SBI says:
Away from agriculture but dependent
Agriculture is no longer as dominant as it once was, yet it is still the backbone of the country's employment landscape.
According to the report, the share of agriculture in total employment has fallen from 66% in 1987–88 to 43% in 2023–24, a decline of 23 percentage points over 37 years. Even in 2025, it continues to employ 43% of the workforce.
Meanwhile outside farms, most jobs are still concentrated in small units with non-agricultural enterprises employing fewer than 19 workers accounting for 42.3% of employment.
Larger enterprises with more than 20 workers employ 13.7% of workers in 2025, up from 10.8% in 2024, a modest rise.
Labour force participation: Steady, but split
The labour force participation rate (LFPR) for people aged 15 and above stands at 59.3% in 2025, slightly lower than 59.6% in 2024.
However, the gaps are huge:
- Male LFPR: 79.1%
- Female LFPR: 40.0%
Rural India continues to show higher participation (62.8%) compared to urban areas (52.2%), pointing to stronger dependence on labour-based livelihoods outside cities.
Youth unemployment: Lower than global average
Youth unemployment in India stands at 9.9% in 2025, below the global average of 12.6% for the 15–24 age group.
However, the report flags a key limitation: the 15–29 age bracket may blur structural trends due to ongoing education. A focus on the 30+ group presents a much lower unemployment picture.
A deeper breakdown shows:
- Rural male unemployment: 0.78% (vs 2.6% in PLFS estimates)
- Urban male unemployment: 2.26% (vs 11.8% in PLFS estimates)
Unit-level analysis using Current Weekly Status also shows lower unemployment among workers aged 30 and above.
How does job market looks across states
Employment outcomes vary widely by geography.
Lower unemployment is seen in states such as Gujarat, Madhya Pradesh and Karnataka. At the other end, Goa, Nagaland and Arunachal Pradesh (6.6%), Punjab (5.3%) and Telangana (5%) report higher-than-national-average unemployment of 3.1%.
Inequality in work: regular jobs stand out
Job quality differs significantly across types of employment. The Gini coefficient indicates lower inter-state inequality in regular wage work and higher inequality in self-employment, suggesting that average regular wage earnings are relatively more uniform across states. Here's the Gini coefficient reported by SBI, for different segments.
- Regular wage/salary work shows the lowest inequality (0.095)
- Casual labour shows higher inequality (0.145)
- Self-employment shows the highest inequality (0.183)
Gender differences are also pronounced. Women face higher inequality than men, particularly in self-employment, where the rural + urban female Gini stands at 0.240 compared to 0.163 for males.
Who gets better jobs — and who doesn’t
Household structure also make a difference as women heading households are:
- 4.4% more likely to be in regular wage employment
- 4.2% less likely to be in casual labour
In rural areas, female headship reduces casual labour by 5%, while in urban areas it is linked to a 10% rise in regular wage work.
Education also reshapes outcomes sharply:- The probability of casual labour falls from 0.21 among non-literate women to 0.03 among those with higher secondary education and above
- Probablity of regular wage employment rises to 0.44 at higher education levels
According to the report, education reduces casualisation, and pushes women into more stable wage jobs.
Social and sectoral divides remain visibleEmployment patterns continue to reflect social and industry segmentation.
Women from ST, SC and OBC groups are more likely to be in casual labour than those from the ‘others’ category:
- ST women: +12.1%
- SC women: +14.5%
- OBC women: +4.4%
However, SC women also show a 5.4% higher likelihood of regular wage employment, indicating mixed outcomes across categories.
Sectorally, casual labour is heavily concentrated in construction and agriculture. Manufacturing and services show lower informality, while transport stands out, with women recording a higher share of regular wage employment compared to men.
States: Participation doesn’t always mean better jobs
Some states manage both higher participation and better job quality, Karnataka, Tamil Nadu and Odisha among them.
Others struggle on both fronts. Uttar Pradesh, Bihar and Punjab report low participation along with poor job quality.
Then there is a third pattern: Rajasthan and Chhattisgarh show higher participation but weaker job quality, pointing to gaps in job security and protection.
“Rajasthan and Chhattisgarh record higher participation but lower job quality, indicating gaps in social protection and job security,” the report stated.
Informality still dominates the labour market
Despite changes, informality remains the major feature of India’s workforce, covering around 80–90% of workers.
State-wise:Punjab: 82%
Uttar Pradesh and Bihar: 81% each
Rajasthan, Chhattisgarh, Andhra Pradesh and Madhya Pradesh: ~74%
Sector-wise distribution shows:Agriculture: 42% of informal employment
Trade and hotels: 17%
Other services: 14%
Rural areas account for 59% of informal workers, compared to 41% in urban areas.
What drives informality?
The report highlights clear patterns:
- Women are 4.8% more likely to be informal workers than men
- Urban workers are 4% less likely to be informal than rural workers
- Muslim workers are 8% more likely to be informal
- Christian workers: 3% less likely
- SC workers: 2.6% more likely to be an informal worker
- OBC workers: 1.8% more likely to be working informally
Sectoral impact is also significant:Manufacturing reduces informality by 31.7%
Services by 30.6%
Trade and hotels by 4.6%
Construction increases it by 4.5%
Wages and compliance gaps
Around 25% of casual workers earn below statutory minimum wages.
The worst-performing states include:
Chhattisgarh: 70%
Odisha: 66%
Jharkhand: 65%
Maharashtra and West Bengal also report nearly one-third of casual workers below minimum wage levels.
Women make up 45% of underpaid casual workers, despite accounting for only 25% of the casual workforce.
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