To date, a major proportion of India’s educated youth is struggling to find a job in the current economy. A latest State of Working India 2026 report published by Azim Premji University indicates an unemployment rate of 40% among young graduates. The ones who once pursued their desired courses in the hope of bagging a stable and viable job role continue to struggle amid the unemployment crisis in the country. It also sheds light on the gap between the literacy rate and job opportunities across the country.
The report suggests that around 40% of individuals aged 15 to 25 are without jobs, while the figure is around 20% for those falling between 25 and 29 years. The fact that this has become a long-term trend is discerning. Although the share of degree holders has gone up, the unemployment rate remains stagnant around 35% to 40% from 1983 through 2023, indicating a prolonged issue rather than an interim slowdown.
Moreover, the study reveals that though around half of young male graduates manage to secure some sort of work within a year, only a small fraction secure stable long-term roles. As a matter of fact, around 7% of graduates have been able to land salaried roles within a year, indicating a hegemony of short-term roles instead of permanent and stable ones.
At a time when the country is about to witness the peak of the ‘working-age population’ with 367 million people in the 15–29 age group, the issue of unemployment remains adamant, causing a major disadvantage to the economy. The youth, which could potentially reach milestones with its calibre, is sitting at home in misery. What’s more unfortunate is that this population will likely start declining after 2030. Therefore, it’s the best and once in a decade opportunity for the authorities to take concrete steps towards employment generation to convert its demographic advantage into economic development. Otherwise, the public expenditure will continue to rise with limited sources of revenue.
Furthermore, the monetary constraints are significantly impacting the education and employment decisions of the youth. The share of young men enrolled in education has dipped from 38% in 2017 to 34% by late 2024. Woefully, many young individuals are putting their studies on the back burner to support their families. The report noted a visible jump in the number of young men leaving education due to financial constraints, from 58 per cent in 2017 to 72 per cent in 2023.
Although the overall employment has increased post COVID-19, the study indicates a huge inclination towards agriculture. As per the data, out of 83 million jobs created between 2021–22 and 2023–24, nearly 40 million were in the agricultural sector. It demonstrates a shift to earlier patterns where youth are moving away from manufacturing and services to earn a living.
All-inclusive, the recent study reveals a tragic picture of India’s economy, displaying a high unemployment rate even though more and more people are getting educated. Since only a few years are left for 2030, the government needs to prioritise employment generation for the country’s development.