Urban Unemployment Rate Declines to 6.6% in Q1 FY25

India’s urban unemployment rate slightly decreased to 6.6% in Q1 FY25 from 6.7% in Q4 FY24, as per the Periodic Labour Force Survey (PLFS) data released by the National Statistical Office (NSO). This decline was primarily due to a drop in the male unemployment rate. However, the female unemployment rate rose to 9%, marking a four-quarter high.

Key Data Points

Male Unemployment: The male unemployment rate decreased to 5.8% in Q1 FY25 from 6.1% in Q4 FY24.

Female Unemployment: In contrast, the female unemployment rate increased to 9% in Q1 FY25, up from 8.5% in the previous quarter.

Youth Unemployment: The jobless rate for youth (aged 15-29) fell to 16.8% from 17% in Q4 FY24, indicating a slight improvement for this critical demographic.

Labour Force Participation Rate (LFPR)

Overall LFPR: The overall LFPR slightly declined to 50.1% in Q1 FY25 from 50.2% in the previous quarter.

Male LFPR: Male participation in the labor force increased to 74.7% from 74.4%.

Female LFPR: Female LFPR saw a decline to 25.2% from 25.6%, suggesting a withdrawal of women from the workforce.

Employment Composition

Self-Employment: The share of people engaged in self-employment fell to 40% from 40.5%.

Salaried Workers: The proportion of salaried workers increased to 49%, indicating a rise in regular wage employment.

Female Regular Employment: The share of female workers in regular jobs rose to 54% from 52.3%, reflecting a positive trend in women’s participation in salaried work.

Sectoral Employment

Tertiary Sector: Employment in the tertiary sector reached a 12-quarter high of 62.4%, with a significant increase in female participation, which rose to 64.2% from 63.4% in Q4 FY24.

Manufacturing Sector: The workforce in the manufacturing sector also saw an increase, contributing to the overall employment growth.

Future Outlook

The government plans to revamp the PLFS, with rural employment data expected to be released quarterly from September. The higher participation in regular salaried work is likely to positively impact the upcoming growth figures, scheduled for release on August 30, 2024.