India's Employment Rate Falls to 39.3%, Lowest Since COVID-19 Pandemic; Female and Rural Unemployment Rise

India's employment situation has come under fresh scrutiny after the country's employment rate declined to 39.3% in October 2026, reaching levels last seen around the COVID-19 pandemic. The latest figures released by the Centre for Monitoring Indian Economy (CMIE) also point to rising unemployment among women and rural workers, raising questions about the availability of jobs across the country.

According to CMIE's Consumer Pyramids Household Survey (CPHS), the employment rate slipped from 39.4% in September to 39.3% in October. The rate stood at 39.7% in January 2020, before the pandemic disrupted India's economy and labour market.

The number of employed people also declined by approximately 500,000 during October, bringing total employment to 449.5 million, or around 44.95 crore.

Unemployment Rate Rises to 4.7% in October

Alongside the decline in employment, India's unemployment rate increased from 4% in September to 4.7% in October, according to CMIE. The increase was particularly noticeable among women and people living in rural areas. Female unemployment rose to 12.7% in October from 11.7% in September. Meanwhile, rural unemployment increased from 3.4% to 4.7% during the same period.

The figures indicate that women continue to face difficulties in accessing employment opportunities. However, unemployment figures alone do not capture the complete picture, as they do not include people who have stopped looking for work.

CMIE data also showed that India's labour force expanded by approximately nine million during the first ten months of 2026. This was lower than the 13–17 million expansion recorded during the corresponding periods of the previous three years. The slower growth raises questions about whether India's expanding working-age population is finding enough opportunities to enter the workforce.

Government Employment Survey Shows a Different Picture

While CMIE's October findings indicate a deterioration in employment conditions, the government's latest Periodic Labour Force Survey (PLFS) presents a different picture.

According to the quarterly bulletin released by the Ministry of Statistics and Programme Implementation on November 10, India's overall unemployment rate declined to 5.1% during July–September 2026, compared with 5.4% in April–June. The Worker Population Ratio, which measures the proportion of the population that is employed, increased from 51.7% to 52.7% during the same period.

The Labour Force Participation Rate also improved from 54.6% to 55.5%, indicating that a larger share of people aged 15 and above were either working or looking for employment.

The government's survey further recorded an increase in female labour force participation, which rose from 33.2% to 34.7%. These figures, however, should not be directly compared with CMIE's October estimates. The two organisations use different survey methods, and their reported figures cover different periods.

Urban Youth Unemployment Remains a Concern

Despite the improvement in the overall unemployment rate in the government survey, finding employment remains difficult for many young people, particularly in cities. The PLFS July–September bulletin recorded an unemployment rate of 15.3% among people aged 15–29, down from 15.9% in the previous quarter.

However, urban youth unemployment moved in the opposite direction, increasing from 18.2% to 18.9%. Rural youth unemployment, meanwhile, declined from 14.7% to 13.6%. The findings highlight the continuing gap between employment conditions in rural and urban India, particularly for young people entering the job market.

Agriculture Continues to Absorb Rural Workers

The government's employment survey also highlighted agriculture's growing share in rural employment. The proportion of rural workers engaged in agriculture increased from 52.9% in April–June to 56.7% in July–September 2026. Self-employment also accounted for a significant share of rural employment, reaching 62.7% during the quarter.

In urban areas, regular wage and salaried employment accounted for 49.6% of workers. The figures underline the differences in employment patterns between rural and urban India. They also bring attention to the nature of available work, as having a job does not necessarily guarantee stable income or long-term financial security.