India’s unemployment rate falls to 5.1% in July-September quarter: Govt
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India’s unemployment rate for persons aged 15 years and above improved to 5.1% in the July–September quarter of 2026, from 5.2% in the corresponding period a year ago, according to the latest Periodic Labour Force Survey (PLFS) released on Tuesday.
The joblessness rate also declined from 5.4% in the preceding April–June quarter, pointing to an improvement in labour market conditions during the three-month period.
The improvement was driven largely by rural India, where the unemployment rate fell to 4.3% during July–September from 4.8% in the previous quarter. On a year-on-year basis, rural unemployment remained largely unchanged from 4.4% in the corresponding quarter of 2025.
The overall labour force participation rate (LFPR) for people aged 15 years and above rose to 55.5% during the quarter from 54.6% in April–June. The worker population ratio (WPR), which measures the proportion of employed persons in the population, increased by 1 percentage point to 52.7%.
Rural employment drives improvement
Rural India emerged as the key driver of the improvement in labour market indicators. The rural LFPR rose to 58.1% from 56.9% in the previous quarter, while the rural WPR increased by 1.4 percentage points to 55.6% from 54.2%.
The rise in rural employment was accompanied by a sharp increase in agricultural activity. The share of rural workers employed in agriculture rose by 3.8 percentage points during the quarter to 56.7%.
Self-employment also gained traction in rural India, with its share increasing to 62.7% from 61.4% in the previous quarter.
At the same time, the share of workers engaged in casual labour declined. In rural areas, casual labour fell to 21.7% from 22.5%, while in urban areas it declined to 10.7% from 11.1%.
Female participation improves
The survey also showed a notable improvement in women's participation in the labour market. Overall female LFPR increased to 34.7% during July–September from 33.2% in the preceding quarter.
The female WPR rose to 32.8% from 31.3%, indicating a rise in the proportion of women who were employed during the period. Among men, the WPR increased to 73.4% from 73%, while urban male LFPR rose marginally to 77.3% from 77%.
Urban employment remains stable
Urban labour market indicators remained broadly stable during the quarter. Urban LFPR edged up to 50.4% from 50.2%, while the urban WPR was largely unchanged at 46.9%, compared with 46.8% in the preceding quarter. The urban unemployment rate stood at 6.8%, compared with 6.7% in April–June.
The share of regular wage and salaried workers in urban areas, however, increased marginally to 49.6% from 49.3% in the previous quarter.
On a year-on-year basis, the overall LFPR increased by 0.4 percentage points from 55.1%, while the overall WPR rose by 0.5 percentage points. Rural LFPR and WPR increased by 0.9 percentage points each over the corresponding quarter of the previous year.