The unemployment rate (UR) marginally increased to 4.8 per cent in December 2025, while the Labour Force Participation Rate (LFPR) continued its upward
trend. The UR was 4.7 per cent in November 2025, the lowest since April. The rural UR remained unchanged from November at 3.9 per cent, while the urban UR increased to 6.7 per cent from November’s 6.5 per cent. The LFPR measures the number of people working or actively seeking work. It was at 56.1% in December, increasing from November’s 55.8 percent. While rural LFPR rose to 59.0 per cent from November’s 58.6 per cent, the urban LFPR marginally declined to 50.2 per cent from November’s 50.4 per cent. Also Read: 84% Indian Professionals Feel Unprepared for Job Change as AI Reshapes Hiring in 2026: Research December saw the highest female total LFPR, 35.3 per cent. While the female rural LFPR stood at 40.1 per cent, the female urban LFPR was recorded at 25.3 per cent. The Worker Population Ratio (WPR) is a key economic statistic that shows the percentage of the overall working population. A higher WPR signals greater economic activity and opportunity. WPR marginally declined to 53.4 per cent. The male overall WPR was 74.1 per cent, while the female overall WPR was 33.6 per cent in December, 2025. Outlook for 2026 India’s unemployment rate is projected at around 4.9 per cent in 2026, according to IMF estimates based on the International Labour Organisation's modelled data. Trading Economics expects India’s unemployment rate to be around 5.1 per cent by the end of the next quarter and around 5.4 per cent in the long run. These numbers are modelled forecasts and are not based on any survey results. Analysts caution that unemployment trends in 2026 will depend on economic growth, urban job creation, and labour absorption capacity. Changes in participation rates, particularly among the youth and women, will play a critical role in shaping overall labour market outcomes.
