India’s Services Sector Report 2025 – Employment Trends and Dynamics

Description

The India’s Services Sector: Insights from Employment Trends and State-Level Dynamics (2025) provides a comprehensive exploration of how India’s services sector shapes the nation’s labour market. Drawing on data from the National Sample Survey (NSS) and the Periodic Labour Force Survey (PLFS), the report examines structural employment shifts across sectors, sub-sectors, and states between 2011–12 and 2023–24.

The study reveals that services now employ approximately 188 million workers, making it India’s second-largest source of jobs after agriculture. Employment elasticity in services rose to 0.63 post-COVID, demonstrating its resilience as a labour shock absorber. However, the report highlights persistent challenges — over 87% of service workers remain informal, women’s participation is disproportionately low, and regional divides are widening.

States like Karnataka, Maharashtra, Tamil Nadu, and Telangana have built high-value service hubs, while others remain dependent on low-value, traditional services. The report calls for targeted interventions to address informality, promote women’s inclusion, expand rural service opportunities, and strengthen formal employment. Positioned under Viksit Bharat @2047, it underscores services as the engine of inclusive growth, digital transformation, and employment-led development.