Events NCAER hosted the launch event for its study, India’s Employment Prospects: Pathways to Jobs, at its campus on December 11, 2025. At this event, the speakers shared findings of the study that explores the evolving contours of India’s labour market, with a focus on its key determinants, including employment; quality 
of employment; sectoral multiplier effects; patterns of occupational mobility; and, the structural barriers hindering increased job creation in the country. The event opened with welcome remarks and introductions by Dr Anil Sharma, Secretary, National Council of Applied Economic Research (NCAER). The NCAER study, authored by Professor Farzana Afridi and her team of researchers at NCAER (Dr Arjita Chandna, Dr Jayanta Talukder, Dr Janani Rangan, Dr Jyoti Thakur, and Ms. Aliva Smruti), shows that India needs to overcome bottlenecks in increasing both the quality and quantity of workforce participation and labour productivity. Emphasising the role of skilling and small enterprises as key drivers of job creation in the country, the study indicates that the recent increases in employment are primarily due to the rise in self-employment, while transition to a skilled labour force has been slow. Strengthening employment opportunities in the labour-intensive manufacturing and services sectors could help sustain GDP growth at around 8 per cent, consistent with the vision of Viksit Bharat, says the study.
Launching the report, NCAER Vice Chairman Manish Sabharwal said, “India is on track to become the world’s third largest economy. While its per capita GDP currently ranks 128th, this underscores valuable opportunities to prioritise employment and inclusive growth.” “India’s self-employment dominance is due to economic necessity rather than entrepreneurial dynamism. Just like small farmers, most of the small enterprises function at subsistence level. India must confront the reality that its employment future is tied to the productivity of its smallest enterprises,” said Professor Afridi. The main challenge is that the unincorporated household enterprises operate with low levels of capital, productivity, and technology adoption. “Enterprises using digital technologies hire 78 per cent more workers as compared to those not using technology. Even a 1 per cent increase in access to credit increases the expected number of hired workers by 45 per cent,” noted Professor Afridi.
In the context of the persistent challenges faced by India in generating employment despite its distinct demographic advantage, the report suggests that on the supply side, India’s workforce could benefit greatly from upskilling, particularly with the advent of new technologies and AI. Medium-skilled jobs dominate employment growth, especially in the services sector, whereas manufacturing remains low-skill intensive. Simulations in the study show that increasing the formally skilled workforce under the moderate growth scenario could lead to significant job gains in the labour-intensive sectors. Thus, an increase of 12 percentage points in the share of the skilled workforce through investment in formal skilling could lead to more than 13 per cent increase in employment in the labour-intensive sectors by 2030. Similarly, augmenting the share of the skilled workforce by 9 percentage points could generate 9.3 million jobs by 2030.
Discussing the report, Professor Aditya Bhattacharjea, Visiting Professor, Institute for Studies in Industrial Development, said, “The report places India in an international context and highlights areas where the country has unique opportunities for improvement and stronger alignment with global benchmarks.” Dr GC Manna, Senior Advisor, NCAER, pointed out, “The report identifies the sectors with the greatest potential to generate significant employment growth.” It estimates the multiplier effects of inter-sectoral linkages to project that a moderate growth in Gross Output (GO) of the relatively more labour-intensive sub-sectors within the manufacturing and services sectors will lead to multi-fold job creation by 2030, of about 53 per cent in the textiles, garments, and related industries in manufacturing, and 79 per cent more jobs in trade, hotel, and related services.
The report concludes with policy suggestions for boosting aggregate demand and investment, and enhancing workforce productivity. It recommends targeted interventions to unlock employment potential in specific sectors. In manufacturing, reorienting production-linked incentives towards labour-intensive industries such as textiles, garments, footwear, and food processing can yield higher job multipliers. In services, policy support for tourism, education, and health can create large-scale, inclusive employment.
The event concluded with a vote of thanks by Dr Arjita Chandna, Dr Jayanta Talukder, and Dr Jyoti Thakur.