India's labour market has largely recovered from the Covid-19 pandemic, according to the 2025 Periodic Labour Force Survey (PLFS). The survey shows that the headline unemployment rate in 2025 was 3.1%, a figure that has remained steady since 2022-23. The labour force participation rate (LFPR) also held steady at 45%, a significant improvement over the pre-pandemic baseline.
However, the pandemic's impact was felt in the agricultural sector, where the share of workers increased from 42.5% in 2018-19 to 45.6% in 2019-20. The share of unpaid workers in household enterprises also peaked at 19.5% in 2023, but has since declined to 15.6% in 2025.
The survey also found that the share of salaried workers has increased, reaching 23.6% in 2025, within touching distance of the pre-pandemic high of 23.8% in 2018-19. Despite these positive trends, the survey's findings are tempered by the uncertainty of the global oil shock, which is expected to leave fresh scars on the economy.
