Only 52,309 establishments filed their first Electronic Challan cum Return (ECR) in FY25, down 6.6% from 56,023 in FY24. Analysts attribute the decline to a “high base effect”, as FY23 job creation was artificially elevated due to ABRY support. According to revised payroll data from the Employees’ Provident Fund Organisation (EPFO), India added 12.9 million net formal jobs in FY25, marking the second consecutive year of decline.

Read industry-specific stories to identify emerging trends

NITI Aayog’s roadmap aims to create 4 million AI-related jobs in India by addressing skill gaps, promoting AI literacy, and establishing a national AI talent mission to transform disruption into opportunity. The travel and hospitality sector is soaring on the back of a strong tourism revival and global events, delivering a +5.9 percent Net Employment Change… The draft rules have “cleverly extended the potential hours of work by tinkering with the spread over time and not the hours of work”, said Sundar. This does not technically violate the ILO convention of not exceeding eight hours in a day and forty-eight hours in a week, he added.

It is clear from Figure 7 that average real earnings have been going up in all three phases. c The Solow growth model, or Solow-Swan model, is an economic model that explains long-run economic growth by focusing on capital accumulation, labour or population growth, and technological progress, ultimately determining a country’s capital-to-labour ratio. MSMEs are central to India’s pursuit of sustainable development, significantly contributing to economic growth, social inclusion, and environmental stewardship. Their role is especially vital in achieving the United Nations Sustainable Development Goals (SDGs), which aim to end poverty, protect the planet, and ensure prosperity for all by 2030. In addition to slower payroll growth, the number of new businesses joining the EPFO also declined.

• It should be noted that the patterns captured in Figure 6 do not imply that workers moving from one category to another is what causes a change in their relative proportions.
• The economic impact of startups includes boosting GDP through innovation, attracting FDI, and driving growth in allied industries.
• We divide the period of our analysis (1993–2021) into three sub-periods on the basis of the observed change in employment patterns, that is, looking at the overall quantity aspect of jobs.
• A direct consequence of this would be greater inequality and poverty and a “sharp increase in informality”, he added.
• Although the current policy structure and pace might be able to generate steady employment, there are two broad recommendations that can help realise the goal of Viksit Bharat through employment generation.

The “jobless growth” hypothesis fails scrutiny when subjected to empirical validation and theoretical analysis. India’s growth trajectory has been characterised by rising job levels, robust consumption growth, and high employment elasticity. While challenges remain in fully leveraging the country’s demographic dividend, the overarching narrative decisively refutes the notion of systemic joblessness. Shyam Sundar, professor of human resource management at the Xavier School of Management (XLRI) told IndiaSpend–good for employers, but not workers.

The latest paper “Roadmap for Job Creation in the AI Economy”, unveiled by NITI Aayog CEO BVR Subrahmanyam, highlights how artificial intelligence is reshaping the landscape of work, workers, and workforce. The report highlights that AI for the tech services sector encompasses both risks and opportunities. These policies play a key role in shaping employment patterns, influencing wages, and protecting worker rights. We substantiate this further by looking at the kinds of self-employment which are seeing a rise in the third phase. Figure 4 shows the share of the different employment categories within the employed population over the time period 1993–94 to 2021–22.

Quantifying the Growth-Employment Nexus: Employment Elasticity and Capital Dynamics

Additionally, this brief has identified premature manufacturing development and the maturing of the demographic dividend as two phenomena that will affect the evolution of India’s employment landscape and potentially impede the transformation to ‘Viksit Bharat’. MSMEs and inclusive growth are deeply interconnected, with Indian MSMEs driving regional development and ensuring that economic progress reaches marginalized and underserved areas. The ABRY scheme, launched in October 2020, subsidized provident fund contributions to encourage hiring during the post-COVID recovery. By March 31, 2024, the scheme had spent ₹10,188.5 crore, benefiting 6.05 million workers across 1.52 lakh establishments. However, the expenditure remained well below the originally allocated ₹23,000 crore, indicating limited uptake. Startup tech companies, fintech, healthtech, edtech, and e-commerce logistics companies in India are among the fastest-growing sectors.

NITI Aayog releases a ‘Roadmap for Job Creation in the Artificial Intelligence (AI) Economy’

While hovering between 4% in the first phase, it skyrocketed in the second phase to 12% in 2017–18, and after that it shows a downward trend, but remains at an all-time high level of 9%. Also, notable from the figure is the fact that UR is close to zero for the age-group 36-64, and the fact that we still have a non-negligible overall UR reflects the burden of the demographic bulge in the youth population. Their agility, innovation, and widespread presence enable them to support large industries, strengthen the link between MSMEs and entrepreneurship, and promote MSMEs and inclusive growth by reducing regional and social disparities. Recent policy reforms and targeted government initiatives—ranging from enhanced credit access and sector-specific support to digitalization and simplified regulations—are equipping MSMEs to scale up, innovate, and integrate more deeply into global value chains.

MSMEs contribute to 62% of total employment in India, making them the second largest employment generator after agriculture. India’s startup ecosystem is more than just a collection of unicorns—it’s a powerful force creating jobs, boosting GDP, and driving global recognition. From tech startups in India to e-commerce logistics companies in India, this movement is reshaping industries and opening up opportunities like never before. Companies in sectors such as retail, logistics, and e-commerce are setting up warehouses and back offices in smaller cities to be closer to consumers and reduce costs. This has created new roles in customer service, operations, and supply chain management. Shreehari reports on social gugobet com justice issues including labour, migration and criminal justice, and public policy.

He won the Laadli Media & Advertising Awards for Gender Sensitivity in 2023, and was a finalist for the 2023 Red Ink Awards and 2024 Human Rights and Religious Freedom Journalism Awards. He has a post-graduate diploma from the Asian College of Journalism, Chennai, and a master’s degree in development from Azim Premji University. Estimates of temporary labour migration in the country vary from 15 million to 100 million migrant workers, “a variance that indicates the ambiguity of the phenomenon”, according to a December 2020 policy document on internal migration. The labour ministry proposed to increase the daily limit on working hours from 10.5 to 12 hours, including one hour of rest, in the draft rules of Code on Occupational Safety, Health and Working Conditions, but added that no worker would be allowed to work for more than 48 hours a week. The International Labour Organization (ILO) expressed deep concern over the development.