Unemployment rate climbs to 5.6% in May as rural farm jobs decline post harvest

New Delhi: India’s unemployment rate rose to 5.6% in May from 5.1% in April, driven largely by a shift in rural employment away from agriculture, according to data released Monday by the Ministry of Statistics and Programme Implementation (MoSPI).

Unemployment among women was marginally higher at 5.8%, compared to 5.6% for men during the month.

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The share of rural workers aged 15 and above employed in the primary sector, largely agriculture, fell to 43.5% in May from 45.9% in April. This shift coincided with the end of the Rabi harvest season, which typically brings a seasonal dip in farm-related employment.

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MoSPI said the contraction in agricultural activity affected both men and women in rural areas. It added that rural employment is gradually moving toward secondary and services sectors, signalling a broader structural transition in the rural labour market.

Urban labour dynamics, by contrast, remained relatively stable. The data showed only minor changes, with a slight drop in the number of self-employed individuals and casual workers, contributing modestly to the overall uptick in unemployment.

India’s labour force participation rate (LFPR) for individuals aged 15 and above declined to 54.8% in May, from 55.6% in April, reflecting subtle shifts across both rural and urban employment landscapes. Rural LFPR stood higher at 56.9%, while urban participation lagged at 50.4%.

Male participation remained significantly higher than female participation, though it, too, declined slightly. In rural areas, men’s LFPR slipped to 78.3% in May from 79% in April, and in urban areas to 75.1% from 75.3%.

Women’s participation continued to reflect deep-rooted disparities. In rural areas, the female LFPR stood at 36.9%, highlighting persistent structural barriers to workforce access.

The Worker Population Ratio (WPR), which indicates the proportion of the population that is employed, also softened. The overall WPR declined to 51.7% in May from 52.8% in April. In rural areas, it stood at 54.1%, while urban WPR was lower at 46.9%.

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Female employment remained especially subdued. Among rural women aged 15 and above, the WPR was 35.2% in May, while urban women reported an even lower 23%. At the national level, the female WPR stood at just 31.3%.

MoSPI noted that the decline in LFPR and WPR and the rise in unemployment were largely seasonal, driven by reduced farm work post-harvest, higher summer temperatures that limited outdoor activity in some regions, and a shift of some unpaid female workers in higher-income rural households toward domestic duties.