Datanomics: Job patterns expose India's labour market fragilities

Mahendra Dev, the chairman of the Economic Advisory Council to the Prime Minister (EAC-PM), recently noted that the impact of high tariffs imposed by the United States (US) on India might be less on growth, but more on jobs. High female youth disengagement, rising unemployment among the educated, and the vulnerability of labour-intensive sectors like textile and apparel highlight structural weaknesses in the labour market. These fault lines indicate that while growth may remain steady, global shocks such as tariff hikes could magnify job losses. 

 

4 in 10 young women not working or studying

 

The share of the youth not in employment, education and training (NEET) has fallen to 24.2 per cent in 2024 from 30.7 per cent in 2020 , but the gender divide remains. In 2024, 39 per cent of young women were in NEET compared to just 10.3 per cent of young men. This exclusion of women from the labour force and education makes the job market particularly fragile when external shocks increase pressure on employment. 

 

    Unemployment highest among educated workers

 

 Unemployment by education level shows that those with higher qualifications face greater stress. This mismatch signals that India’s labour market struggles to absorb skilled and educated workers, raising the risk of job losses due to trade disruptions. 

 

Textile and apparel jobs remain volatile

 

Employment trends in the textile and apparel sectors reveal its vulnerability to global uncertainties. By 2023-24, growth in them stalled. With renewed fears of tariff pressures, these sectors, employing a large share of semi-skilled and female workers, are seen as particularly exposed, making them critical fault lines in India’s employment landscape.