Urban unemployment held steady in the third quarter at 6.4 percent: PLFS data

Urban unemployment held steady in the third quarter at 6.4 percent

India’s urban unemployment rate remained unchanged in the third quarter of FY25, even as the economy likely rebounded from a near two year low in the previous quarter, according to data released by the government on February 18.

While male unemployment inched up to 5.8 percent in the October-December period from 5.7 percent in the previous month, female unemployment dipped further to 8.1 percent in Q3FY25 from 8.4 percent in the previous quarter and 8.6 percent in the year ago period.

India’s economy likely performed better in the third quarter, after a disappointing slump in second quarter which saw growth slip to 5.4 percent.

The economy, however, is unlikely to witness over 7 percent growth anytime soon, with the Economic Survey projecting 6.3-6.8 percent growth for the coming year.

The Economic Survey, released on January 31, did reiterate the need to create an additional 7.8 million jobs in the non-farm sector each year.

Another worry for the government, as per periodic labour force survey data would be the decline in labour force participation for women.

Female labour force participation for the first time slipped from the previous quarter after the pandemic to 25.2 percent from 25.5 percent earlier.

Experts indicate that the Indian economy likely grew 6.6-6.8 percent in the third quarter.

There was no change in number of people employed in regular salaried work in the third quarter either, as proportion of workforce in regular salaried work remained at 49.4 percent in urban areas.

The number of workers in secondary sector declined further to 31.8 percent from 32.3 percent in the previous quarter and 32.1 percent a year ago, as more people move to tertiary work.

Manufacturing growth has been anaemic in the year, with first advance estimates predicting the sector to slow down to 6.5 percent from 9.7 percent in FY24.

Tertiary sector is expected to perform better with growth falling to 7.2 percent from 7.6 percent earlier.