India’s Labour Market: In Transition, But Not Yet in Transformation

India’s labour market today is marked by a mix of progress and precarity, a combination that makes interpretation difficult and policy action urgent. On the surface, the country is undergoing a positive shift.India’s labour market today is marked by a mix of progress and precarity, a combination that makes interpretation difficult and policy action urgent. On the surface, the country is undergoing a positive shift. Labour force participation has increased across demographic groups, with women accounting for nearly 70% of all new entrants since 2018. Output growth remains high by global standards. Services continue to drive the national growth story, while a renewed industrial strategy signals the state’s effort to broaden the base of productive employment. However, as the five papers in this special issue demonstrate, these encouraging signals rest on structural weaknesses that hinder the labour market’s ability to generate secure and meaningful work. The deeper story is one of rising participation but stagnant job quality, strong output growth but weak employment elasticity in the formal sector, and higher productivity in select sectors but persistent underemployment for much of the workforce. Understanding this complex labour market pattern is essential for imagining a credible future of work in India.