India’s unemployment rate 5.6% in June: NSO data

India's unemployment rate remained at 5.6% in June, with rural areas decreasing to 4.9% and urban areas rising to 7.1%, influenced by seasonal factors.

India’s unemployment rate was 5.6% in June, same as in May, according to Periodic Labour Force Survey (PLFS) data released by the National Statistics Office (NSO) on Tuesday. This is the third monthly unemployment trend released by NSO, which started releasing these numbers from April 2025.

India’s unemployment rate 5.6% in June: NSO data

The data shows that while the overall unemployment rate remained flat in June compared to May, it decreased by 20 basis points (one basis point is one hundredth of a percentage point) in rural areas to 4.9% and increased by 20 basis points in urban areas to 7.1%. Similarly, the unemployment rate was flat compared to May for men at 5.6%, but decreased by 10 basis points for women to 5.6%.

Some of the decline in the rural unemployment rate is explained by people pulling out of the labour force, which is the part of the population that is either working or looking for a job. The overall labour force participation rate (LFPR) declined by 40 basis points compared to May to reach 41%; but by 70 basis points for rural areas. The combination of the trend in LFPR and unemployment rate is also reflected in the share of workers in the population or worker population ratio (WPR). Overall, WPR declined by 30 basis points compared to May to 38.7% in June, but decreased by 50 basis points in rural areas.

Because labour market conditions are prone to seasonal fluctuations, sequential monthly numbers do not lend themselves to much analysis, and one will have to wait until April 2026 to make year on year comparisons of the monthly employment numbers.

This limitation notwithstanding, NSO has made some observations about the latest employment numbers which give an idea into the ongoing labour market dynamics. The reasons for the decline in rural unemployment rate, LFPR, and WPR compared to May are largely seasonal, NSO said in a press release. “The marginal decline in LFPR and WPR in June 2025 was largely influenced by seasonal agricultural patterns, intense summer heat limiting outdoor physical work, and a shift of some unpaid helpers, particularly from higher-income rural households, towards domestic chores,” NSO said. While NSO did not publish any tables on these trends, its press release said that unpaid helpers becoming engaged in domestic duties, especially in higher-income rural areas, brought down the LFPR. One number cited to argue this is the share of rural women workers in agriculture, which decreased from 70.2% in May to 69.8% in June. This, the press release suggested, could be because the decline in rural inflation reduced the need for women workers in agriculture.