India's graduate unemployment crisis: educated youth seeking opportunities.
India faces a looming demographic challenge as its working-age population is set to decline after 2030. A recent report by Azim Premji University, ‘State of Working India 2026’, highlights the urgent need for job creation to capitalize on the country’s demographic dividend.
The report reveals a concerning trend: 67% of India’s unemployed are graduates. Specifically, nearly 40% of graduates aged 15-25 and 20% of those aged 25-29 are jobless. The data underscores a significant skills gap and a lack of suitable employment opportunities for educated youth.
While the long-term impact of AI remains uncertain, the report points out that the past five years have not produced enough salaried positions to absorb the growing number of graduates entering the workforce.
Between 2021-22 and 2023-24, India’s employed population increased from 490 million to 572 million, with rising employment rates for both men (71% to 74%) and women (26% to 34%). However, a significant portion of these new jobs—40 million out of 83 million—were in the agricultural sector, with women accounting for 38 million.
The study also notes a nearly four-fold increase in women’s self-employment since 2017. Yet, earnings from self-employment for women and salaried positions for both genders have largely stagnated, indicating a struggle for economic advancement despite increased participation.
Education levels among young people have risen significantly over the past four decades, particularly for women. However, a worrying trend is the decline in male tertiary enrollment, as young men increasingly drop out of education to support their families.
The Azim Premji University report emphasizes the necessity of expanding adequate salaried employment opportunities to meet the aspirations of a highly educated workforce. It also recommends integrating vocational training with school curricula to bridge education and skills gaps, enhance employability, and improve the social perception of vocational education.
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