Majority of employment creation in agriculture, says report

The “State of Working India - 2026”, a report on education and employment prepared by the Azim Premji University, has found that graduate unemployment among the 15- to 29-year-olds in the country remains high — nearly 40% among the 15- to 25-year-olds, and 20% among the 25- to 29-year-olds. Only a small share among them were able to secure stable salaried jobs within a year of graduation, the report, released here on Tuesday (March 17, 2026), said.

The access to higher education by poorest families has increased by 7%, according to the report. However, the share of young men in education fell from 38% in 2017 to 34% in late 2024, with a large share citing the “need to support household incomes” as reason for their withdrawal. “The most common reason given for withdrawing from education is the need to support household incomes. In 2017, the share citing this reason was 58%. By 2023, it had increased to 72%,” the report said.

The report said the country’s employed population has increased from 490 million to 572 million post COVID, with employment rates rising from 71 to 74% for men and from 26 to 34% for women, between 2021-22 and 2023-24. “But the majority of employment creation has been in agriculture. Of the 83 million jobs added between 2021-22 and 2023-24, 40 million have been in agriculture, with women accounting for a large share (38 million),” the report said.

Migration key

The number of women in own-account self-employment has seen a nearly four-fold increase since 2017. “Self employment earnings among women and salaried earnings (for men and women) have largely stagnated. Given uneven economic development across the country, migration has emerged as an important mechanism among the youth to access employment,” the report points out.

It added that the country is nearing the peak of its demographic dividend, with the share of the working age population expected to begin declining after 2030. “The 15- to 29-year-olds, India’s youth, number about 367 million and account for nearly a third of the working age population. Of them, 263 million are not in education and constitute the potential workforce. The pace of employment creation for this young generation in the coming decade will be critical in determining whether India’s demographic dividend can be translated into an economic one,” the report added.

The availability of colleges increased from 29 per lakh youth (2010) to 45 (2021), mainly driven by private institutions. However, regional disparities remained large, the report said, adding that faculty growth has not matched rising student numbers. The number of Industrial Training Institutes (ITIs) has grown by nearly 300% since the 2010s, largely due to private providers. “But, institutional quality, especially among private ITIs, has fallen,” it said.

Between 2007 and 2017, the share of students in tertiary education who belong to the poorest households increased from 8% to 15%. It noted that students from richer households are far more likely to pursue engineering and medicine, as the cost of these degrees often exceeds the annual per capita expenditure of poorer households.

The graduates earn roughly twice as much as non-graduates at entry, and the earnings gap widens over their careers. Entry-level salaries for young male graduates have slowed in growth since 2011, while gender gaps in graduate earnings have narrowed. “Younger cohorts are less concentrated in occupations traditionally linked to their caste or gender,” the report said.