India has the largest youth population globally. Defined as those aged 15–29, they comprise a third of the country’s working-age population. However, their transition from education to employment is still difficult, with opportunities being uneven across regions and social groups.
How long should young people study? Which sectors hold promise for them? Where can they access effective education and skill training for the jobs available? And how can they find remunerative work? The State of Working India 2026 report by Azim Premji University breaks down the transition of young workers from education to job searches into employment, and how this has evolved over the last 40 years.
The following are nine interesting findings from the report that help build on what we already know about young people’s employment journey. These include insights on high youth unemployment despite the increasing number of young graduates, how women’s employment has changed over the last four decades, the accessibility of higher education, and the prevalence of caste-based occupations.
1. The young population will start declining soon
India’s demographic dividend is expected to peak in 2030, after which the share of youth in the population will begin to fall and there will be an increase in the number of elderly people.
To understand this in terms of numbers, India has around 367 million young people who are of working age. Excluding those in education, 263 million young people need meaningful employment for India to maximise its demographic dividend before the window of population growth closes.
2. Higher education and vocational training institutions are growing, but unequally
Educational enrolment has risen sharply over the past four decades, even as employment has declined. Among men aged 15–19, enrolment increased from 49 percent in 1983–84 to 73 percent in 2023–24. For women, the rise was steeper—from 38 percent in 1983 to 68 percent in 2023.
While India’s progress broadly matches global trends, caste-based inequalities continue to limit fair access to higher education. Between 2011 and 2023, enrolment among Scheduled Castes rose from 11 percent to 26 percent. Among Scheduled Tribes, enrolment increased from 8 percent to 21 percent during the same period. However, these figures still fall below the national average of 28 percent, indicating that entry into education is still unequal.
This rise in enrolment has been driven by a major expansion of higher education and vocational training institutions, especially after liberalisation. The number of higher education institutions in India has grown from 1,644 to 69,534 (as per AISHE). The sharpest growth was between 2000 and 2010, when institutions increased by 150 percent. The number of public and private institutions was nearly equal from the 1950s to the 1980s. Today, however, 80 percent of higher education institutions are private.
Since the 2000s, Industrial Training Institutes (ITIs) have also expanded rapidly—growing from 3,674 in 2005 to 14,582 in 2025. This 300 percent increase has been largely driven by private providers, which now account for about 80 percent of ITIs.
However, this expansion has been uneven across regions. Central and western states such as Madhya Pradesh, Gujarat, and Rajasthan have caught up with southern states in per capita institutional availability. In contrast, northern states, including Bihar, Jharkhand, and West Bengal, still lag behind.
For ITIs, expansion has also come with a decline in quality. Based on eight indicators, including enrolment, pass percentage, and trade diversity, ITI quality rankings have worsened over time. Newer ITIs generally perform worse on these measures, and private ITIs, on average, rank lower than public ones.
3. Higher education remains prohibitively expensive for many
The cost of education, especially for professional degrees, has risen significantly. Medicine and engineering are among the most expensive courses.
Access to these courses is thus determined by household income. The report groups households into four quartiles based on monthly per capita consumption expenditure (MPCE): the first quartile includes the poorest households, and the fourth the richest.
Youth from richer households are far more likely to enrol in professional courses like engineering and medicine, which offer higher earnings and more stable job prospects. In contrast, youth from poorer households are more likely to study commerce and humanities. This restricts their access to higher-paying jobs and highlights the need for policies that improve affordability and ensure more equal access across institutions and fields of study.
4. Young men are increasingly withdrawing from education
An increasing share of young men aged 15–24 cite the need to support their household income as the reason for leaving education. This rose from 58 percent in 2017 to 72 percent in 2023.
5. Young graduates are increasing, but not their employment rates
The transition from finishing education to finding a job is a critical phase for young people. In India, this transition lasts at least a year for most, with no guarantee of securing salaried employment.
Graduate unemployment has worsened in recent years even as the number of graduates has grown with the rise in both the youth population and tertiary enrolment rates over the last few decades. Combined with high unemployment, this has resulted in a large pool of unemployed graduates—11 million out of 63 million people aged 20–29 were unemployed in 2023.
Tracking young male graduates for a year after they report being unemployed shows that about half of them find some form of work. However, very few secure stable jobs. Only around seven percent obtain permanent salaried employment within a year.
6. The sectors young people work in are diversifying
An increasing share of young workers are moving away from agriculture. More young women are entering the manufacturing sector, largely driven by jobs in the textile and apparel industry. In contrast, older women are mainly employed in community and personal services.
For young men, key entry-level non-agricultural jobs are in trade, transport, and construction—similar to older men.
In 2023, the main sectors employing men were computer and information services, retail trade, and construction and civil engineering. For women, most graduate employment was in computer and information services, health, and education.
7. Engagement with traditional occupation has lowered
Caste- and gender-based occupational segregation has weakened over time, with younger workers less likely to be in jobs traditionally linked to their caste or gender.
The largest increase in employment among young SC and ST workers has been in manufacturing, particularly in paper, vehicles, and telecommunications equipment.
8. The gender pay gap amongst graduates is narrowing
The earnings gap between young male and female graduates has steadily narrowed. By 2023, young women graduates earned as much as their male counterparts.
9. Young people continue to migrate
Youth make up about 40 percent of informal migrant workers. Bihar and Uttar Pradesh are among major sources of migration, while Delhi, Haryana, and Punjab are key destinations.
As regions move through different stages of demographic transition and economic growth, migration has become a key labour flow—from poorer, younger states to richer, ageing ones.
The following graph shows the number of informal workers moving into or out of a state for every 100,000 registered informal workers in that state.
These findings point to a clear pattern: India has expanded access to education, but the path to meaningful employment is a long one. More young people are studying for longer, yet many struggle to find stable, well-paying work—especially those from poorer households and marginalised communities.
At the same time, the nature of work itself is shifting. Young people are entering new sectors, breaking away from traditional caste- and gender-linked occupations, and narrowing the pay gap. But problems of access to quality education, affordability, and stable employment continue to persist.
The window to address these challenges is limited. The solution is no longer limited to creating more jobs. It also involves ensuring that young people—across regions and social groups—can access education, training, and work that is both equitable and meaningful.
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Know more
- Learn what the data reveals about India’s gig workers.
- Read more about the changing caste-based occupations over three generations.
