India's unemployment rate drops to 3.1% in 2023: NSO

The country's unemployment rate declined to 3.1% in 2023, as against 3.6% in the preceding year, according to the latest employment-unemployment indicators report under Periodic Labour Force Survey (PLFS) by the National Statistical Office .

As per the report, the unemployment rate both in terms of geography and gender witnessed a significant decline in 2023. The report highlights that in rural areas, the unemployment rate declined to 2.4% in 2023, as against 2.8% in the preceding year. The unemployment rate in urban areas tumbled to 5.2% during the year under review as against 5.9% in 2022.

Genderwise, the unemployment rate amongst females declined to 3% in 2023 as against 3.3% in 2022. The unemployment rate amongst males declined to 3.2% during the year under review, as against 3.7% in the same period of the preceding year.

The labour force participation rate (LFPR) increased to 59.8% in 2023, as against 56.1% in 2022. The LFP rate is defined as the percentage of persons in labour force (i.e. working or seeking or available for work) in the population. The LFPR witnessed a significant increase in both rural and urban areas. In rural areas, the LFPR increased to 63.4%, as against 58.5% in the preceding year. The LFPR in urban areas increased to 51.4% in 2023, as against 50% in 2022.

Genderwise, the LFPR among females increased to 41.3% in 2023, as against 33.9% in 2022. The LFPR among males increased marginally by 78.3% in 2023, as against 78% in 2022.

The worker-population ratio (WPR), which is defined as the percentage of employed persons in the population stood at 54.1 in 2023, as against 58 in 2022. The WPR in both urban and rural areas witnessed a significant increase in 2023. In urban areas, the WPR increased to 48.8 in 2023, as against 47 in 2022. The WPR in rural areas increased to 61.9 in 2023, as against 56.9 in 2022.

Gender-wise, the WPR among males increased marginally to 75.8 in 2023, compared to 75.1 in 2022. The female worker population ratio increased marginally to 40.1 in 2023, against 32.8 in 2022.  

According to NSSO, the objective of PLFS is to estimate the key unemployment and unemployment indicators such as WPR, LFPR, and unemployment rate in the short time interval of three months for the urban areas only in the current weekly status and to estimate employment and unemployment indicators in both ‘usual status’ (ps+ss) and CWS in both rural and urban areas annually. Current weekly status is determined on the basis of a reference period of the last 7 days. The activity status or usual status is determined based on the activities pursued by the person in the last 365 days.