India Faces Job-Quality Gap as Agriculture Still Dominates
India Faces Job-Quality Gap as Agriculture Still Dominates
New PLFS 2025 findings show India's job growth isn't translating into higher-quality, stable work outside farming and the informal sector, underscoring the need for reform.
A new SBI Research report based on PLFS 2025 unit-level data shows India's labour market is stabilizing, but the quality of jobs beyond agriculture and informal work remains a big challenge. The labour force participation rate stood at 59.3% in 2025, with a wide gender gap—79.1% for men and 40% for women.
Agriculture still dominates the workforce, employing 43% of workers in the latest period, down from 66% in 1987-88, but the shift to manufacturing and high-quality services is slow.
Non-agricultural enterprises with fewer than 19 workers make up more than 42% of total employment, showing small and informal businesses continue to dominate.
Only 13.7% of workers are in enterprises with more than 20 workers, though this is up from 10.8% in 2024 as the government pushes manufacturing.
Informal employment remains widespread across states, with Punjab recording the highest informal share at 82%, followed by Uttar Pradesh and Bihar at about 81% each; Rajasthan, Chhattisgarh, Andhra Pradesh and Madhya Pradesh also show high levels.
The report argues that to raise living standards, India must accelerate formal, stable, higher-quality jobs beyond farming and informal work, leveraging policy and investment in manufacturing and services to close the job-quality gap.
