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The unemployment rate in India remains a crucial topic because it offers insight into the health of a nation’s economy. A low unemployment rate indicates a strong job market where businesses are expanding and there are opportunities for people to find work. Conversely, a high unemployment rate suggests a weak economy with limited job growth, potentially leading to social and economic problems.
According to the latest data from the Center for Monitoring the Indian Economy (CMIE), the unemployment rate in India is expected to be around 8% in 2024.
- The unemployment rate in India averaged 8.17% from 2018 to 2024, reaching an all-time high of 23.50% in April 2020 during the COVID-19 pandemic.
- In 2022, the unemployment rate ranged from a low of 6.43% in September to a high of 8.30% in December.
- The unemployment rate started in 2023 at 6.56% in January and increased to 8.30% by December.
- According to the OECD, India’s unemployment rate is forecast to quadruple from 4% to 8% by 2022 despite the country’s healthy economic growth.
- The unemployment rate in India is calculated as
- Unemployment Rate = Number of Unemployed Persons / (Number of Employed Persons + Number of Unemployed Persons).
To be considered unemployed in India, a person must be at least 16 years old, be available to work full-time in the last four weeks, be actively looking for employment during this period, and be temporarily employed. Have been laid off from your job but are actively looking to rejoin.
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A recent survey by the Ministry of Statistics & Programme Implementation reveals some encouraging news. The unemployment rate among graduates (aged 15 and above) has decreased from 14.9% to 13.4% in 2022-23.
However, the unemployment picture varies significantly across different regions. Chandigarh and Delhi boast the lowest rates (5.6% and 5.7% respectively), while states like Rajasthan (23.1%) and Odisha (21.9%) face much higher challenges. Andaman & Nicobar Islands, Ladakh, and Andhra Pradesh also have unemployment rates exceeding 20%.
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Source of Data
The primary sources of data for the unemployment rate in India are:
- The Periodic Labour Force Survey (PLFS) conducted by the National Sample Survey Office (NSSO) under the Ministry of Statistics and Programme Implementation (MoSPI)
- The Centre for Monitoring Indian Economy (CMIE) which conducts household surveys to estimate the unemployment rate
The PLFS was launched in April 2017 to provide labor force data at more frequent intervals. Five annual reports covering both rural and urban areas have been released so far, with the latest being for 2022-2023.
The CMIE’s Consumer Pyramids household survey panel includes over 174,405 households and 522,000 members over 15 years old. This data is used to estimate the monthly unemployment rate in India
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Unemployment Rate in India
The unemployment rate last ten years or 15 years:
| Year | Unemployment Rate (percent) |
| 2024 | 6.57 (January 2024) |
| 2023 | 8.003 |
| 2022 | 7.33 |
| 2021 | 5.98 |
| 2020 | 8.00 |
| 2019 | 5.27 |
| 2018 | 5.33 |
| 2017 | 5.36 |
| 2016 | 5.42 |
| 2015 | 5.44 |
| 2014 | 5.44 |
| 2013 | 5.42 |
| 2012 | 5.41 |
| 2011 | 5.43 |
| 2010 | 5.55 |
| 2009 | 5.54 |
| 2008 | 5.41 |
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Unemployment Rate in India State wise 2023
| State | Unemployment Rate (%) |
| Haryana | 37.4 |
| Rajasthan | 28.5 |
| Bihar | 19.1 |
| Jharkhand | 18.0 |
| Jammu and Kashmir | 14.8 |
| Tripura | 14.3 |
| Sikkim | 13.6 |
| Goa | 9.9 |
| Andhra Pradesh | 7.7 |
| Himachal Pradesh | 7.6 |
| Assam | 4.7 |
| Haryana | 3.74 |
| Chhattisgarh | 3.4 |
| Madhya Pradesh | 3.2 |
| Maharashtra | 3.1 |
| Karnataka | 2.5 |
| Gujrat | 2.3 |
| Odisha | 0.9 |
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Latest data from India’s CMIE shows India’s youth unemployment rate has reached the alarming level of 45.4%—among the highest in the world. This is doing deep damage. For the sake of the country we must not hide behind slogans, must put politics aside & take corrective measures.
— Kaushik Basu (@kaushikcbasu) May 29, 2024
Major Economic Events Impacting the Unemployment Rate in India
India’s unemployment rate has fluctuated over time due to several major economic events
- Global Financial Crisis (2008-2009)
- Demonetisation (2016)
- Covid-19 Pandemic (2020)
- Inflationary Pressures
Causes of Unemployment in India
India, like many countries, faces a complex issue of unemployment. Several factors contribute to this, creating different types of unemployment with varying durations. Here are a few of the main reasons behind unemployment in India:
- India’s growing population means more people are entering the workforce, sometimes outpacing job creation.
- There’s a mismatch between the skills employers need and the skills the workforce possesses. This can leave many qualified for the wrong jobs.
- Industries that rely heavily on manual labor haven’t seen enough recent investment. This creates fewer job opportunities.
- Low productivity in agriculture, coupled with limited options outside farming, makes it difficult for workers to transition to other sectors.
- Complex regulations, lack of government support, and weak infrastructure make it hard for small businesses to flourish, limiting job creation.
- Low investment in manufacturing restricts job opportunities in this crucial sector.
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What can be done?
The government can address unemployment through various initiatives:
- Creating government jobs with minimum wages provides stability and income.
- Offering temporary work opportunities in exchange for food can help the unemployed during tough times.
- By managing economic forces, the government can reduce cyclical unemployment caused by market fluctuations.
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