Self-employment has created the majority of jobs (farm and non-farm) in the Indian economy over the past six years, with numbers rising from 23.9 million in FY18 to 35.8 million in FY24, according to the HSBC Bank Employment Trends in India report.
The annual CAGR is a “healthy” 7%, he added, with the self-employed category taking the lead among categories in the Indian labor market, as opposed to casual work and salaried work, ANI reported citing the study.
According to the report, the rise in self-employment was in tandem with a sharp rise in the labor force participation rate (LFPR), which increased from 53% in FY18 to 64.3% in FY24. The LFPR is calculated for working individuals aged 15-59.
Status of women’s participation in the labor market
According to the report, total employment increased by 15.5 million in FY24, with women leading a significant share. While males led in terms of participation rate with 58.2%, female participation increased to 31.7% in FY24.
“The increase in employment of 15.5 million people was driven by more women working, with female employment rising by 10.3 million – almost double the number of male workers to 52 million,” HSBC Bank said in a report.
Demographic growth coupled with the growth of the self-employed sector suggests that more women and younger job seekers are entering the workforce and turning to self-employment due to the limited availability of wage-based jobs.
Which sectors provide jobs?
As for non-farm, non-farm job-providing sectors, construction (2 million jobs added), manufacturing (1.5 billion) and services (4.1 billion).
In the services sector, the main employers were activities related to communication, education, accommodation and catering, retail and wholesale trade and transport, with trade alone contributing 40% of the total increase. It also accounted for more than 20% of total non-agricultural job creation.
In manufacturing, total employment in food and beverages, furniture, metals, textiles and tobacco rose to 7 million, with textiles and clothing accounting for nearly 33% of the increase.
MSMEs were also job creators and accounted for 48% of manufacturing employment and 48% of services employment in FY24. Employment through MSME trade and services generated 1.7 million jobs in just two years, he added.
