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Self-Employment Surges as India's Fastest-Growing Job Sector
17 Nov
Summary
- Self-employment grew at a "healthy CAGR of 7.0%" from FY18 to FY24
- Women's labor force participation increased to 31.7% as of FY24
- Services, construction, and manufacturing led non-farm job creation
As of November 17, 2025, a recent report by HDFC Bank has revealed that self-employment has become the strongest engine of job growth in India over the past six years. The study shows that self-employment, encompassing both farm and non-farm activities, surged from 239 million in FY18 to 358 million in FY24, marking a "healthy CAGR of 7.0 per cent".
This rapid expansion in self-employment has outpaced the growth of salaried work and casual labor. Salaried or regular wage jobs increased only marginally, from 105 million in FY18 to 119 million in FY24, growing at a more subdued "CAGR: 4.1 per cent", while casual labor stagnated, inching up from 114 million to 122 million at a "CAGR: 1.1 per cent" during the same period.
Notably, the report highlighted that the Labor Force Participation Rate (LFPR) for the working-age population (15-59 years) increased from 53 per cent in FY18 to 64.3 per cent in FY24, with women's participation rising to 31.7 per cent as of FY24. This suggests that more women and youth have been entering the labor force, many of whom may be turning toward self-employment due to limited availability of wage-based jobs.
The report also noted that the increase in total employment of 155 million people was driven by a significant surge in female employment, which rose by 103 million, nearly double the addition of male workers at 52 million.
While the non-farm sector now accounts for 54 per cent of total employment, agriculture continued to add jobs, primarily through female workers. In the farm sector, the increase was "driven by higher female employment (+74 million) while male employment increased marginally (+5 million)".
At the same time, non-farm job creation was led by the services, construction, and manufacturing sectors. Services alone added 41 million jobs between FY18 and FY24, construction added 20 million, and manufacturing added 15 million. Within services, the largest contributors to employment were wholesale and retail trade, transport, education, hotels and restaurants, and communication-related activities.
