India’s joblessness falls to three-quarter low of 4.8% in Q3 FY26 | Industry News

India’s labor market showed resilience in the third quarter (October-December/Q3) of 2025-26, with the unemployment rate falling to a three-quarter low of 4.8 per cent. This marked a sequential decline in unemployment during the financial year, according to the latest Periodic Labor Force Survey (PLFS) data published by the National Statistics Office (NSO) on Tuesday.

The unemployment rate among people aged 15 and over in rural areas (under current weekly status or CWS requirements) fell from 4.4 percent in the second quarter (July-September/2nd Quarter) to 4 percent in the 3rd quarter. In urban areas, it decreased from 6.9 percent to 6.7 percent in the same period.

Under the CWS framework, a person is classed as unemployed if they do not work for even one hour on any day during the reference week, but are looking for or available for work for at least one hour on any day of that week.

The labor force participation rate (LFPR), a measure of the share of the population that is working or actively looking for work, increased from 55.1 percent in the 2nd quarter to 55.8 percent in the 3rd quarter. The increase was driven by increased participation of women in both rural and urban labor markets.

Youth unemployment (15-29 years old) fell to 14.3 percent from 14.8 percent in the previous quarter. The unemployment rate for young women decreased from 17 percent to 16.6 percent, and for young men from 14.1 percent to 13.5 percent. This group is largely made up of first-time job seekers, making it an important indicator of the health of the labor market.

In terms of employment composition, the share of self-employed workers, including unpaid domestic workers and self-employed workers, increased from 55.8 percent in Q2 to 56.3 percent in Q3. On the other hand, the rate of regular salaried employees decreased from 25.4 percent to 24.9 percent in the same period.

On a sector basis, employment in agriculture increased from 42.4 percent to 43.2 percent, while the share of employees in the secondary sector decreased from 24.2 percent to 24 percent.

NSO revamped the PLFS sampling method in January last year to generate monthly and quarterly estimates of key employment indicators for both rural and urban areas using the CWS approach at the all-India level. This release is the third to present quarterly data under the revised design.