India’s July unemployment rate falls to 5.1%, below expectations

India’s unemployment rate declined to 5.1 per cent in July, from 5.5 per cent in June, according to government data released on Monday, signalling an improvement in labour market conditions.

The July reading was also better than market expectations. A Reuters poll of economists had forecast the unemployment rate at 5.4 per cent for the month.

The decline comes as policymakers continue to focus on employment generation alongside economic growth, with the labour market remaining a key indicator of the strength and inclusiveness of the recovery.

India’s unemployment rate has been closely watched amid efforts to create more jobs across manufacturing, services and other sectors as the economy expands.

The latest data suggests that the share of people without work fell in July compared with the previous month, although the headline unemployment rate alone does not capture broader trends such as labour-force participation, job quality or the nature of employment.