India’s job market saw a concerning shift in 2024, as per data released by the Ministry of Statistics and Programme Implementation on April 9, 2025. The country witnessed a decline in overall labour force participation, primarily led by a drop in women’s participation in rural areas, while unemployment rates edged up for both men and women.

Labour Force Participation Rate Drops to 59.6%

In 2024, India's labour force participation rate (LFPR) — the percentage of working-age people who are either employed or actively looking for work — dropped slightly to 59.6% from 59.8% in 2023. This seemingly minor decline masks a larger issue: a significant drop in the number of women in the workforce, especially from rural India.

• Female LFPR fell to 40.3% from 41.3% in 2023, indicating that more women exited the workforce over the past year.

• Conversely, male LFPR increased to 79.2% from 78.3%, showcasing a gender-divergent trend in workforce participation.

Women’s Unemployment Rises Sharply in Rural India

Unemployment rates have inched upward across genders. However, the brunt of the rise was borne by rural women, painting a stark picture of joblessness outside urban centres.

• Women’s overall unemployment rose to 3.1% from 3%, while rural female unemployment increased to 2.1% from 1.9%.

• Men’s unemployment increased marginally to 3.3% from 3.2%, with rural male unemployment at 2.8%, a subtle rise from 2.7%.

This data reflects that women in rural areas are disproportionately dropping out of the workforce, likely due to limited job opportunities, cultural constraints, or migration-related factors.

Better Agricultural Performance Didn’t Translate into Jobs for Women

Interestingly, agriculture saw improved performance in rural areas during 2024, which should have ideally boosted rural employment. However, the sector did not absorb enough female workers, leading to more women dropping out of rural jobs altogether.

This paradox hints at structural barriers in employment generation, especially in sectors traditionally dominated by male labour or where mechanisation is reducing the need for manual female labour.

Urban Employment Scenario Shows Signs of Recovery

Unlike rural areas, urban India displayed relatively positive employment trends, with a decline in unemployment and a slight rise in female labour force participation.

• Urban female LFPR improved to 27.6% from 27.2%, suggesting that more women are entering or staying in the urban workforce.

• Urban unemployment dropped to 6.7% from 7.5%, indicating some recovery in job availability.

• Male urban unemployment remained stable at 4.4%, and overall urban unemployment decreased to 5% from 5.2%.

These numbers suggest a divide between urban and rural job opportunities, with urban centres potentially offering more diversified and resilient employment avenues, especially in services, IT, retail, and manufacturing.

Understanding the Urban-Rural Divide in Employment

The contrast between urban job gains and rural job losses underlines an enduring challenge in India’s labour market. While cities show signs of recovery post-pandemic and economic slowdown, rural regions remain volatile, especially in terms of women’s economic inclusion.

Key reasons behind the divide:

• Better access to education and employment in urban areas

• Higher rate of mechanisation in agriculture, leading to lesser demand for manual rural labour

• Migration trends, where men migrate to cities, leaving women with limited local employment options

Women’s Participation: A Persistent Challenge

The declining female workforce participation continues to be a major policy concern for India, which has one of the lowest female labour force participation rates among emerging economies.

Although urban women are slowly reclaiming ground, rural women — who form the backbone of agricultural and informal sector work — are being left behind. This calls for:

• Focused skill development programmes for rural women

• Promotion of women-friendly jobs in rural areas

• Flexible work formats and better safety infrastructure

What Needs to Be Done?

India needs a comprehensive approach to ensure inclusive job creation, especially for rural women. Key policy suggestions include:

• Strengthening self-employment opportunities and SHGs (Self Help Groups)

• Incentivising private sector to hire women, particularly in Tier II and Tier III cities

• Increasing budget allocation to women-centric employment schemes like Mahila Shakti Kendra and PMKVY

Looking Ahead

The 2024 labour data is a reminder of the deep-rooted employment inequalities in India, especially gender-based and rural-urban divides. Policymakers, industry stakeholders, and civil society must come together to ensure equitable and inclusive economic growth that empowers every segment of the workforce.

As India pushes forward towards becoming a $5 trillion economy, leveraging the full potential of its female workforce, especially in rural areas, will be key to unlocking sustainable development.

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