The Liberalisation, Privatisation, and Globalisation, or LPG reforms of the 1990s, have led to massive economic growth in India. Today, India is the fifth-largest economy globally, with a GDP of $3.94 trillion. With this pace of development, unemployment has become an important issue that is progressing even more severely among the youth. The Periodic Labour Force Survey (PLFS) reports for July 2023 to June 2024 note that unemployment, after nationwide consistency at 3.2%, is significantly higher among the youth at 10.2%.
States/UTs With Highest Unemployment Rate in India
Some states in India are still reeling from high unemployment rates, particularly among youngsters. Unemployment is associated with poor infrastructure, minimal industrial diversification, and economic issues.
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Lakshadweep (36.2%)
The territorial economy mixes tourism and fisheries, with very few jobs available. It is sharply skewed to the female unemployment rate at 79.7%, showing a wide gender gap. Unemployment in Lakshadweep has the sad distinction of being the highest in any region, with 36.2% of its youth unemployed.
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Andaman & Nicobar Islands (33.6%)
Andaman & Nicobar Islands: 33.6% of the youth population is unemployed. Similar to Lakshadweep, the primary sector for the islands is tourism, so it depends on seasonal employment. Female unemployment here is a staggering 49.5%, resulting in no absolute job security.
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Kerala (29.9%)
In southern India, Kerala has the nation’s highest literacy rate but a 29.9% unemployment rate among youth and 47.1% among women. The state solely depends on the remittance money sent back by expatriate workers without complementing it with the necessary education.
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Nagaland (27.4%)
Nagaland also has the highest unemployment rate, at 27.4%. This is mainly because the state is isolated and lacks economic diversification. The region’s economy is almost agrarian, and the political instability does not help improve investment or provide more job opportunities.
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Manipur (22.9%)
The youth unemployment rate in Manipur is 22.9%. It suffers from issues similar to those in Nagaland. Poor infrastructure and terrorism are among the reasons that restrict jobs, mainly in the towns. There is a problem sustaining themselves among the youth in such a scenario.
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Ladakh (22.2%)
The unemployment rate is among the highest in Ladakh at 22.2%, while female unemployment is a shocking 38.3%. The region mostly depends on tourism, and geographical isolation has highly restricted the scope for young people, particularly women.
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Arunachal Pradesh (20.9%)
The youth unemployment rate of Arunachal Pradesh is about 20.9%, which shows the state to be highly agricultural-dependent and industrially underdeveloped. The state’s poor connectivity and geographical isolation are fueling its unemployment problem.
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Goa (19.1%)
Though it remains one of the most popular tourist destinations, the youth unemployment rate in Goa is 19.1%. Tourism provides seasonal employment, but many youths—most of whom are women (31%)-do not have permanent jobs because there is no other industry nearby.
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Punjab (18.8%)
Punjab has an unemployment rate of 18.8%. It is the country’s largest agri-state, but its youth still struggle to get jobs. For better opportunities, many of its youths migrate abroad, accentuating the state’s unemployment problem.
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Andhra Pradesh (17.5%)
The youth unemployment rate stood at 17.5% in Andhra Pradesh, suggesting a struggle to generate enough jobs to match population growth. Though the IT and manufacturing sectors have started gaining momentum lately, they have never absorbed the increasing number of job seekers.
Lowest Unemployment Rate among States and Union Territories
On the other hand, some states and UTs have been more effective in keeping this unemployment rate low due to perfect policymaking, industrialization, and economic growth.
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Madhya Pradesh (2.6%)
Madhya Pradesh has the lowest unemployment rate in India, at 2.6%. The state’s developed agricultural base and rapidly growing industrial sectors have ensured job security. The government’s directions on skill development through initiatives like PMKVY will also create more jobs.
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Gujarat (3.1%)
This is primarily contributed to by the 3.1% unemployment rate, spurred by the sound industrial base in textiles, chemicals, and petrochemicals. The low levels of unemployment in the state owe it to policies that are friendly to business enterprises and entrepreneurship.
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Jharkhand (3.6%)
Jharkhand’s 3.6% youth unemployment rate reflects a mining and steel-state economy where stable employment is readily available to most young men. The female unemployment rate is meagre, at 1.5%, with gender imbalances in the workforce.
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Delhi (4.6%)
Delhi, the capital of India, boasts a relatively low unemployment rate of 4.6%, mainly because of the booming service sectors in IT, retail, and real estate. However, its population growth rate is taking a toll on its ability to keep unemployment low for the long haul. The cost of living does not help the situation either.
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Chhattisgarh (6.3%)
Chhattisgarh’s solid unemployment rate of 6.3% is due to its heavy concentration in agriculture, mining, and manufacturing. The state’s rural employment schemes, particularly MGNREGA, have contributed most to reducing unemployment.
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Dadra & Nagar Haveli (6.6%)
This small UT has an unemployment rate of 6.6%. Its proximity to the industrially developed states of Gujarat and Maharashtra is adding jobs in the industrial sectors, though gender disparities persist, with a male unemployment rate of 7.8% and a female unemployment rate of 3.7%.
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Tripura (6.8%)
The state has 6.8% youth unemployment. Agriculture, handicrafts, and government employment schemes are its main thrust areas. Rural employment programs have benefited the state mainly because of its sizeable agrarian population.
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Sikkim (7.7%)
The unemployment rate in Sikkim is a mere 7.7%, thanks to its focus on sustainable development, especially tourism and organic farming. However, the state needs to diversify the economy even more in the long term to reduce unemployment.
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West Bengal (9%)
West Bengal has an unemployment rate of 9%. At the same time, the state has expanded in industries like IT and services and continues to have issues in agriculture and manufacturing. The improved infrastructure and enhanced industrial development can be challenged to facilitate more opportunities here.
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Uttar Pradesh (9.8%)
Perhaps surprisingly, the most populous Indian state, Uttar Pradesh, has maintained a youth unemployment rate of 9.8%. That would be created by capturing itself with two pioneering areas- promotions of manufacturing and agriculture- on the development front. The challenge would remain and be precisely in the direction of equal job opportunities for women.
Conclusion
The two seemingly different unemployment landscapes in India can be portrayed through the analogy of two sides of the same coin: one is Madhya Pradesh and Gujarat, with low unemployment, achieving successful industrialization and effective policies, and the other is Lakshadweep and Kerala, with poor job creation caused by geographic isolation and social differences.
These imbalances require a multi-pronged strategy concerning skill development, industry diversification, and gender-inclusive policies. There shall be increased government and private cooperation towards sustainable macroeconomic performance that translates into employment opportunities for everyone.
