India’s Unemployment Rate to Decrease by 97 BPS by 2028: ORF Report
According to Think Tank Observer Research Foundation’s report, India is poised to achieve a landmark symbol of a $5 trillion economy by the year 2028, coinciding with a 97 basis points decrease in the country’s unemployment rate. The report, based on India Employment Outlook 2030, forecasts a decline in the unemployment rate from 4.47% in 2024 to 3.68% by 2028.
Post the COVID-19 pandemic, the world’s fastest-growing economy is witnessing revolutionary changes not only in its economic growth but also in its job market. The youth demographic notably contributes to the nation’s economic expansion, aligning with India’s target of attaining a $5 trillion economy by the fiscal year 2026-27 with robust domestic consumption and sustained public investment.
This economic trajectory also anticipates strong private consumption and continued public expenditure. It is estimated that India’s GDP may remain below $4 trillion levels in 2024.
India Targets $5 Trillion Economy by 2028: Service Sector to Propel Job Growth
As India approaches its goal of achieving a $5 trillion economy by 2028, the unemployment rate could potentially decrease to 22%, accompanied by a 97 basis points reduction in the unemployment rate, as projected.
The service sector is expected to play a pivotal role in job creation, with the potential to contribute around 0.12% to total employment. The report highlights ten segments within the service sector, including services, financial services, hospitality, consumer retail, e-commerce, and renewable energy.
This emphasis on the service sector underscores its significance in driving economic growth and employment opportunities in the coming years.
Manufacturing Sector Shows Lower Expectations in Report
While the report demonstrates strong potential in the service sector, it portrays lower expectations regarding the manufacturing sector.
The increase in imports from the US signifies intensified competition, affecting the country’s competitive expenditure and labor sources.
Efforts such as the Make in India initiative by the government aimed at enhancing job prospects in the sector seem to be experiencing diminishing returns.
