India's unemployment rate falls to 5% in August; rural joblessness at 2026 low

India’s unemployment rate among people aged 15 years and above edged down to 5% in August 2026 from 5.1% in July, with rural joblessness falling to its lowest level since January, according to the latest Periodic Labour Force Survey (PLFS) released by the Ministry of Statistics and Programme Implementation (MoSPI).

The rural unemployment rate declined to 4.1% in August from 4.3% a year earlier. Urban unemployment, however, edged up marginally to 6.8% from 6.7% in July.

On a year-on-year basis, the overall unemployment rate under the Current Weekly Status (CWS) approach remained broadly stable in August. The rural unemployment rate declined by 0.2 percentage point from 4.3% in August 2025 to 4.1% this year.

Labour force participation improves

The marginal decline in unemployment came alongside an improvement in labour force participation and the worker population ratio. The Labour Force Participation Rate (LFPR) for people aged 15 years and above rose to 55.6% in August from 55.4% in July.

The Worker Population Ratio (WPR), which measures the proportion of the population that is employed, also increased to 52.8% from 52.5% during the month. Rural India drove much of the improvement in labour-market indicators. Rural LFPR increased to 58.2% in August from 58% in July, while the rural WPR rose to 55.8% from 55.4%. Urban WPR, meanwhile, remained unchanged at 47% during the month.

Rural unemployment falls for men and women

The improvement in unemployment was visible among both male and female workers, particularly in rural areas.

Overall male unemployment declined for the third consecutive month to 4.9% in August, compared with 5.4% in May. Rural male unemployment fell to 4.3% in August from 4.6% in July. Among women, the overall unemployment rate declined for the second consecutive month to 5.1% in August from 5.9% in June. Rural female unemployment fell to 3.9% from 4.3% in July, while urban female unemployment remained broadly stable.

Female participation continues to rise

Female participation in the labour force continued to improve in August. The overall female LFPR rose to 34.8% from 34.4% in July and 33.7% a year earlier.

Rural female LFPR increased to 39.4% in August from 38.8% in July, indicating a continued rise in women's participation in the rural labour market. The August PLFS estimates are based on information collected from 3,70,160 people, including 2,11,353 respondents in rural areas and 1,58,807 in urban areas.