Even before the much-feared impact of AI on employment takes effect, India’s graduate employment situation looks to be dire according to this new study. Azim Premji University’s State of Working India 2026 report focuses on graduate employment. The findings are startlingly worrisome.
“Less than 7% of male Indian graduates manage to find a permanent salaried job within a year, with the proportion being an even lower 3.7% when it comes to a white-collar job… a mere 4% of males who pass the 12th standard find a permanent salaried job in the first year, with the figure being a minuscule 1.5% for white-collar jobs….while 41% of males – graduate or 12th pass – found some employment, salaried or otherwise, in less than four months, a similar proportion did not find any job even after three years, based on data from the Centre for Monitoring Indian Economy’s (CMIE) Consumer Pyramids Household Survey (CPHS).”
The 80’s were believed to be the worst of graduate unemployment in India often blamed on years of socialism which had failed the economy. Even Bollywood made hay with a series of films based on the unemployed youth. Turns out we are worse off than that today.
“…the report analysed data from the government’s PLFS and the erstwhile Employment Unemployment Survey (EUS) and found that graduate youth unemployment has been a “persistent problem” and stood at 39.33% in 2023, up from 35.02% in 1983, for those less than 25 years of age.”
What explains this?
“The report said there could be multiple reasons graduate unemployment is particularly high among the youth: too many graduates chasing too few jobs, waiting for the right job, and studying for competitive exams or adding to their skill sets. The report estimated, using PLFS and EUS data, that in 2023, 11 million out of 63 million graduates in the 20-29 age bracket were unemployed.
Interestingly, the difference in incomes for graduate and non-graduate youths has narrowed over the last decade. The report noted that while the gap between the two increased “substantially”, especially between 2004 and 2011, there has been a “slowdown in earnings growth for young men” since 2017.”
Social factors could also be a reason. We have had labour shortages and unemployment at the same time suggesting a mismatch in supply and demand. Graduates have been found to shun even higher paying jobs on the shop floor, preferring office environments with lower pay, resulting in excess supply for white collar jobs.
“While high graduate youth unemployment has been a constant feature in India, unemployment has become more prevalent even among the poor. In 1993, 9% of unemployed young male graduates belonged to the poorest 25% of households. By 2023, their share had risen to 16%. For women, the corresponding proportion had risen from 2% to 11%. This, the report reasoned, indicated that a rise in incomes gave families room to forego additional income from one more working member so that they could find a suitable job in line with their qualifications and aspirations.”
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