Why Millions of Indians Stayed Out of the Jobs Market

In 2025, an estimated 59.3% of India's population aged 15 and older was part of its labour force, meaning almost six in every ten persons were either engaged in economic work or looking for some. But what about the other forty-odd percent? Why were they neither working nor looking for employment? Almost 40% of Indians in this age group translates to a staggering number of individuals, and understanding what kept them out of the labour force matters well beyond statistics.

The PLFS asks those outside the labour force what their primary reason for being so was. The question is posed only to this subset of respondents, not to everyone surveyed.

Domestic Bind

Over 45% of those outside the labour force cited childcare and homemaking as their primary reason. The wish to continue studying came next, at 26.9%, and roughly a fifth pointed to health or age.

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The reasons vary significantly by age and gender. Childcare and homemaking commitments were cited largely by women, accounting for 60% of those outside the labour force in that category, compared to just 1% of men. Given that women already make up a disproportionately large share of those outside the labour force, this being the most common reason is perhaps not surprising. It is, however, very striking.

Age shapes the picture too. Teenagers are most likely to be economically inactive simply because they want to keep studying. Over 85% of 15–19-year-olds outside the labour force cited this as their reason in 2025. Through the twenties, thirties, and forties, domestic commitments emerge as the dominant reason, though again, this is driven almost entirely by women. Men in these age groups are rarely out of the labour force, and among those who are, health and age tend to explain it better.

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Among those above 60, health and age unsurprisingly become the leading reasons. But even here, more than half of women aged 60–64 continue to cite childcare and domestic responsibilities as their primary reason for being outside the labour force.

Regional Variations
While the three broad reasons hold across most of the country, their relative dominance varies considerably by state, possibly reflecting different demographic stages and social norms. Domestic responsibilities remain the leading cause of inactivity in several states, but in ten, including nearly all north-eastern states except Tripura, the desire to continue studying takes precedence. In Himachal Pradesh and Andhra Pradesh, health and ageing reasons are the biggest deterrents.

The share citing domestic responsibilities is telling: 58.8% in Daman and Diu and Dadra and Nagar Haveli, 55.1% in Bihar, 54% in West Bengal, and just 14.7% in Ladakh and 18% in Himachal Pradesh.

Nationally, around a quarter, 26.9%, cited the desire to continue studying. In parts of the north-east, however, this share was considerably higher: in Meghalaya and Arunachal Pradesh it exceeded half at 51.9%, and Sikkim was not far behind at 49%.

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If a fifth of those outside the labour force nationally cited health or age, in Himachal Pradesh that share was 36.3%, followed by Andhra Pradesh at 34.8%. Telangana and Kerala were the other two states where this figure crossed 30%.

"Social reasons" were cited as a factor by 2.4% nationally, but jump to 8.4% in Andhra Pradesh, 6.2% in Uttar Pradesh, and 5.4% in Madhya Pradesh, with women far more likely to report this than men in each case. Chandigarh is a curious outlier: 7.5% of economically inactive men there simply said they were too well-off to work, a reason that barely registers anywhere else. The share is a little higher in Himachal Pradesh too, particularly among rural men, with 4.2% of them saying the same.

Push or Pull?
The data offers an interesting window into the lives of India's potential workforce that remains untapped, but it is not merely trivia. For a young and ambitious economy chasing greater prosperity, having such a large share of the population outside the labour force is far from a reassuring picture. And not all of this is by choice.

When unemployment is high and quality work opportunities remain stubbornly scarce, people sometimes stop looking altogether, drifting out of the labour force entirely. Economists call this the discouraged worker effect: the point at which repeated rejection or a bleak job market simply extinguishes the search.

India's labour data has consistently pointed to difficult conditions, particularly in urban areas, among the young, and among women.

The Time Use Survey offers a different lens but paints a very similar picture: that Indian women spend a disproportionately high amount of time on unpaid domestic and care work, which raises an uncomfortable question. Are women outside the labour force because the household is pulling them in, or are they absorbed into unpaid domestic work because the labour market is pushing them out? When childcare and homemaking show up as the predominant reason for women's economic inactivity even in their forties and fifties, the latter starts to look far more likely.