India's unemployment rate holds steady at 5.6% in June; labour participation dips

India's unemployment rate (UR) remained unchanged at 5.6% in June 2025, signaling stability in joblessness despite fluctuations in participation and employment ratios, according to the latest data shared by the Ministry of Statistics & Programme Implementation (MoSPI).

The labour force participation rate (LFPR) for persons aged 15 years and above dipped slightly to 54.2% in June 2025, down from 54.8% in May. Rural LFPR stood at 56.1%, while urban LFPR was 50.4%. Among males, rural and urban LFPRs were 78.1% and 75.0% respectively, a marginal decline from the previous month.

Female LFPR in rural areas was notably low at 35.2%, indicating continued gender disparities in labour market engagement. The worker population ratio (WPR), which reflects the percentage of people actually working, was 53.3% in rural and 46.8% in urban areas, bringing the national average to 51.2%, down from 51.7% in May. For women, WPR was 33.6% in rural areas and just 22.9% in urban areas, with a national female WPR of 30.2%.

The government says the marginal decline in LFPR and WPR in June 2025 was largely influenced by seasonal agricultural patterns, intense summer heat limiting outdoor physical work, and a shift of some unpaid helpers, particularly from higher-income rural households, towards domestic chores.

The trend was more pronounced among rural females, where over a 1-percentage point decline in workforce participation was observed compared to May 2025, primarily due to a reduction in unpaid helpers typically engaged in agricultural work. Data shows that a number of unpaid helpers in June 2025 reported themselves as engaged in domestic duties, contributing to a decline in the labour force, especially among higher-income rural households.

Additionally, the share of rural female workers in agriculture dropped from 70.2% in May to 69.8% in June 2025, indicating a reduced need for agricultural engagement among women, perhaps due to a decline in rural inflation. The ministry also says that the decrease in the unemployment rate for rural areas for both males and females can be attributed to an increase in the share of own-account workers in June 2025 compared to May 2025, along with a reduction in the number of unemployed persons.