The recently released sixth annual Periodic Labour Force Survey (PLFS) from the National Sample Survey Office (NSSO) in India reveals a significant decline in the unemployment rate from 6.1% in 2018 to 3.2%, with an accompanying increase in the Labour Force Participation Rate from 36.9% to 42.4%, and the Female Labour Force Participation Rate increased from 17.5% to 27.8%. According to the report from the State Bank of India (SBI), the decline in unemployment can be attributed to self-entrepreneurship across all echelons and the emergence of higher education.

In recent years, the India government has introduced a series of financing schemes for different enterprises, including microcredit for self-employed enterprises engaged in non-agricultural work and unsecured loans for street vendors affected by the COVID-19, to reduce the cost and risk of borrowing for entrepreneurs and to improve the competitiveness and profitability of self-employed enterprises, from which we can see the importance that the India government places on the field of entrepreneurship. The data showed an increase of more than 50% in self-employment, which shows that the decline in the unemployment rate is closely related to the surge in entrepreneurship. In addition, the increasing number of female entrepreneurs participating in various types of financing schemes has also led to an increase in female labor force participation.

The youth unemployment rate in the PLFS (in the age group of 15-29 years) shows a decline from 12.9 percent to 10 percent for the three-year period. In the past, most young people around the age of 17 were no longer within the education system and have been part of the labor force. However, this group of young people had difficulties in finding employment because of the lack of jobs and the inability of their education to adapt to the needs of the labor market, which caused the high youth unemployment rate. The current reports indicate that the average age of young people remaining in the education system has risen to 23-24 years old, which means more young people choose to access higher education rather than enter the job market directly, leading to a reduction in the youth unemployment rate.