PLFS 2025: Employment Trends, Labour Market Challenges and Skill Development in India

15 May 2026

Periodic Labour Force Survey (PLFS) 2025 highlights improving employment indicators in India, while exposing persistent challenges related to skills, women’s participation and quality job creation.

Key Highlights of PLFS 2025

Improving Employment Indicators: PLFS 2025 reported Labour Force Participation Rate (LFPR) at 59%, Workforce Participation Rate (WPR) at 57%, and unemployment rate at 3%.
Rise in Formal Employment: Regular salaried employment increased from 22% to 24%, indicating gradual labour market formalisation and improved access to social security benefits.
Women’s Participation Improving: Female labour force participation improved, especially in rural areas, reflecting growing economic inclusion and better access to employment opportunities.
Structural Economic Shift: Agriculture’s employment share declined to 43%, while manufacturing and services expanded, signalling a gradual structural transformation of the Indian economy.
Higher Female Wage Growth: Women’s earnings increased faster than men’s across salaried, self-employed, and casual labour categories, though significant gender wage disparities continue.

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About Periodic Labour Force Survey (PLFS) Annual Report

The National Statistics Office (NSO) conducts PLFS to generate high-frequency labour market data for employment and unemployment analysis.
Published by : Ministry of Statistics and Programme Implementation (MoSPI).
Period Covered: The 2025 report covers January–December 2025, marking a shift from the earlier July–June agricultural cycle.
Methodology Changes: Revamped sampling design with increased sample size (~2.7 lakh households) and rotational panel system for higher accuracy.
Key Indicators
- Labour Force Participation Rate (LFPR): Percentage of persons aged 15 years and above who are part of the labour force.
  - Labour force includes:
    - Persons working (employed)
    - Persons seeking or available for work (unemployed)
  - It indicates the extent of active participation of the population in economic activities.
- Worker Population Ratio (WPR): Percentage of persons aged 15 years and above who are employed in the population.
  - It includes all individuals engaged in any economic activity (paid/unpaid, formal/informal).
  - Reflects the actual employment level in the population.
- Unemployment Rate (UR): Percentage of persons aged 15 years and above who are unemployed among the labour force.
  - Unemployed persons are those who are not working but seeking/available for work.
  - It measures the severity of joblessness within the active labour force (not total population).
- Activity Status Measures
  - Usual Status (PS+SS): Based on last 365 days (principal + subsidiary activities).
  - Current Weekly Status (CWS): Based on the last 7 days, capturing short-term employment dynamics.
Factors Influencing Labour Trends: Education levels, gender roles, sectoral shifts, and urban–rural differences significantly influence employment patterns.

Challenges with India’s Labour Market

Education-Employment Mismatch: Around 5 million graduates entered the labour market annually between 2004-2023, but only nearly 2.8 million secured employment opportunities.
- Rising educational attainment has not been matched by adequate high-quality job creation in formal sectors.
Low Skill Training Coverage: Only 4% of individuals aged 15-59 received formal vocational or technical training despite strong employment outcomes among trained workers.
- Workforce participation among formally trained individuals reached 83% for men and 51% for women, highlighting the importance of skilling initiatives.
Persistent Gender Constraints: Women continue to face barriers due to unpaid care work, childcare responsibilities and household obligations limiting sustained workforce participation.
- Urban self-employed men work nearly 17.5 hours more weekly than women, indicating the disproportionate burden of unpaid domestic labour.
High NEET Population: Nearly 25% of youth aged 15-29 remain in the NEET (Not in Education, Employment, or Training) , reflecting significant underutilisation of demographic potential.
- Many NEET youth are excluded from unemployment statistics because they are no longer actively seeking jobs.
Informality and Wage Gaps: Women earn nearly 76% of male wages in salaried work, 69% in casual labour and only 36% in self-employment categories.
- Informal employment and absence of adequate social protection continue to affect income security and productivity growth.

Initiative To Improve State of Labour ( UPSC CSE Pre 2018)

Government Initiative	Year of Launch	Nodal Ministry/Department	Key Focus Area
Skill India Mission	2015	Ministry of Skill Development and Entrepreneurship (MSDE)	Skill India Mission aims to improve employability through industry-oriented vocational training, upskilling and apprenticeships for youth and women.
Pradhan Mantri Kaushal Vikas Yojana (PMKVY)	2015	Ministry of Skill Development and Entrepreneurship (MSDE)	PMKVY provides short-term skill training, Recognition of Prior Learning (RPL) and certification to enhance workforce participation and formal employment.
National Apprenticeship Promotion Scheme (NAPS)	2016	Ministry of Skill Development and Entrepreneurship (MSDE)	NAPS promotes apprenticeship-based learning through financial incentives to industries for creating job-linked training opportunities.
Stand-Up India Scheme	2016	Department of Financial Services, Ministry of Finance	Stand-Up India promotes entrepreneurship among women, SCs and STs through bank loans for greenfield enterprises.
Pradhan Mantri Mudra Yojana (PMMY)	2015	Department of Financial Services, Ministry of Finance	PMMY supports self-employment and micro-enterprises through collateral-free institutional credit to small entrepreneurs, especially women.
Deendayal Antyodaya Yojana – National Rural Livelihood Mission (DAY-NRLM)	2011	Ministry of Rural Development	DAY-NRLM strengthens women-led self-help groups and promotes rural livelihoods, entrepreneurship and financial inclusion.
Atmanirbhar Bharat Rojgar Yojana (ABRY)	2020	Ministry of Labour and Employment	ABRY incentivises employers to create formal sector jobs through EPFO-linked social security support for new employees.
e-Shram Portal	2021	Ministry of Labour and Employment	e-Shram creates a national database of unorganised workers to improve social security coverage and labour formalisation.
PM-DAKSH Yojana	2020	Ministry of Social Justice and Empowerment	PM-DAKSH provides free skill development and reskilling programmes for SCs, OBCs, EWSs and marginalised workers.
Support to Training and Employment Programme for Women (STEP)	1986	Ministry of Women and Child Development	STEP enhances women’s employability through skill training, income-generation support and access to credit-linked activities.
PM Vishwakarma Scheme	2023	Ministry of Micro, Small and Medium Enterprises (MSME)	PM Vishwakarma supports traditional artisans and craftspeople through skill training, toolkit incentives and concessional credit support.

Way Forward

Expand Industry-Oriented Skilling: India must strengthen vocational education, apprenticeships and industry-linked skill programmes aligned with emerging sectors like AI and green technologies.
Promote Women’s Workforce Participation: Policies supporting childcare facilities, flexible work arrangements, safe transportation and equal wages can improve female labour force participation.
Boost Labour-Intensive Manufacturing: Expanding labour-intensive sectors such as textiles, electronics, food processing and green manufacturing can generate large-scale employment opportunities.
Strengthen Social Protection: Expanding formalisation, labour rights, health insurance and pension coverage can improve employment quality and economic resilience for workers.

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Conclusion

India’s demographic dividend can translate into sustainable economic growth only through productive employment generation, skill development and greater inclusion of women and youth.

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