Stark mismatch of jobs versus graduates in India – Report

A report released by a leading Indian university on the employment status of graduates in the country shows a significant gap between education and employment opportunities nationwide.

One of the key findings of the State of Working India 2026 report, released by Azim Premji University (APU) on 17 March, reveals that less than 7% of graduates in India secure permanent salaried jobs within one year of graduation, and of these, only 3.7% manage to land 'white-collar' (office-based) positions.

These numbers show a problem with finding jobs that is affecting young people who have finished college. The report looks at 40 years of trends in the job market for people to see how India is using its young population.

The report, titled “Youth in the Labour Market: Pathways from learning to earning”, says that after waiting for a year, many young people who have finished college do not have the security of a steady office job.

According to government data from the Periodic Labour Force Survey (PLFS), 14.8% of people between 15 and 29 are unemployed, which is almost three times the overall unemployment rate of 4.9%.

The report further notes that while 41% of male graduates secured some form of employment (whether salaried or otherwise) within four months, an equally large segment remained unemployed even after three years.

This shows that there are fewer jobs for the growing number of young people who have finished college, which has been a problem for a long time.

One reason for the unemployment rate among graduates is that there are too many young people with college degrees competing for a limited number of jobs.

Many young people between the age of 20 and 29 are either waiting for the right job or are studying more and preparing for competitive exams, which delays them from entering the job market.

In 2023 the unemployment rate among graduates under 25 was 39.33%, which's much higher than the 35.02% recorded in 1983.

Wage growth slows

Furthermore, the income gap between graduates and non-graduates has narrowed in recent years.

While graduates enjoyed substantial income gains between 2004 and 2011, the pace of wage growth for them has slowed down since 2017.

Some people think that this means that finishing college is not as valuable in the job market as it used to be.

This highlights the persistent challenge that young graduates face in their quest for meaningful employment.

Experts like Rosa Abraham, an associate professor at Azim Premji University and the lead author of the report, think that it is too early to say that finishing college is not important.

“It would be premature to completely dismiss the importance of education.”

She argues that “even though graduates' wages have stagnated, they still remain more than double those of non-graduates.”

The report also says that fewer young people are going to school, with 38% of men in school in 2017 but only 34% in 2024.

According to PLFS data, the primary reason for not pursuing education is the growing necessity to contribute to household income. In 2017, 58% of young men cited economic pressure as the reason for not continuing their studies; by 2023, this figure had risen to 72%.

This shift highlights the mounting economic challenges confronting low-income families.

These families are becoming increasingly unable to invest in their children's education, particularly when the returns on such an investment appear uncertain.

Industry ‘needs to be more involved’

Academics and students said that merely expanding access to higher education is not enough, as this expansion has not been accompanied by a corresponding increase in the creation of high-quality jobs.

“The industry has to be more involved in academia. Barring a few universities, especially in urban areas, colleges and universities do not engage much with industry.

“So [what] colleges are teaching students may not be relevant to industry, and industry has to re-train the same students who have got degrees but are not industry ready,” Dr Vidya Yeravdekar, Pro Chancellor, Symbiosis International University, told University World News.

She further said that: “industry professionals should be consulted while framing the syllabus. They should be on the Board of Studies, Academic Council and other bodies of the university. Industry professionals should be invited to teach in classrooms so that they can bring in live projects into the classrooms.”

“Students should also be sent for internships to industry as a structured programme. Faculty should also visit industries to find out what the requirements of industry are and accordingly incorporate them in the curriculum,” Dr Yeravdekar said.

High-quality jobs needed

According to students and experts, despite the surge in enrolments and the proliferation of academic degrees, job creation has failed to keep pace, leaving millions of young Indians deprived of a stable and dignified livelihood.

“The challenge confronting India is not merely to generate jobs but to ensure that the available employment opportunities are of high quality and are situated in sectors that align with the skill sets of its educated youth,” Amitabh Pandey, a postgraduate student in the capital, Delhi, told University World News.