Over a span of four decades, India has significantly improved higher education opportunities to the point where young workers not only have shifted from agriculture to industry and services, but also gender and caste divisions have notably decreased, said the State of Working India 2026 report by Azim Premji University. The report draws attention to the fact that the youth of India - especially the 15 to 29 age group - are not only more educated but also have more aspirations than ever before. These are not mere statistics but real outcomes that we should feel proud of, especially when we look at the continuous progress in educational access and inclusion, said Indu Prasad.
On the other hand, the report warns that India's demographic dividend is already at its highest point, and the percentage of the working-age population will decrease after 2030. It is highlighted that the country's success in job creation over the next several decades will decide whether it can harness this demographic advantage for continuous economic growth.
The paper, authored by Rosa Abraham, follows young Indians as they move from education to employment and shows that there are still deep-rooted issues in the system. Although university enrolments are quite high (28%) and at the level of other countries with similar incomes, the questions about employability and gradual workforce absorption still prevail.
One notable trend is that there is a change in the gender ratio of male students in tertiary education, which fell by 4% points from 38% in 2017 to 34% in 2024, as many young men left education to contribute financially to their families. Meanwhile, women's participation in education has increasingly been growing, which is a sign of better access and social mobility. The report highlights another issue in higher education, i.e. quality. Although the number of colleges has increased (from 29 colleges per 1 lakh youth in 2010 to 45 in 2021), faculty recruitments have lagged behind.
The report uses the student-teacher ratio norms of the All India Council for Technical Education as a benchmark, and notes that these ratios continue to be high, especially in publicly funded institutions. Similarly, the number of Industrial Training Institutes (ITIs) has gone up nearly three times since the 2010s, the growth being mostly through private providers. Yet, the report notes that many private ITIs have deteriorating quality standards, and hence skill readiness is also questioned.
Having a wider reach hasn't changed the fact that economic inequality is a factor in the field of higher education. Children of affluent families are three times more likely to be engaged in expensive courses like engineering and medicine, students coming from poorer families being largely absent in these areas.
The employment outlook remains a key concern. Graduate unemployment among youth stands at nearly 40% for the 15–29 age group, with only a small proportion securing stable salaried jobs within a year of graduation. Graduates make about twice the salary of non-graduates when they first enter the workforce, but wage increases, especially for young men, have been decelerating in the last few years.
The document also highlights a transformation in labour habits, with young employees quitting agriculture for manufacturing and services. Females, in particular, are entering IT, automobile manufacturing, and business services in large numbers, indicating emerging changes in the traditional employment patterns.
At this demographic turning point, India cannot rely merely on education improvements, says the report, which conveys a very direct message. Creating enough jobs and raising the quality of education and training are necessary steps; otherwise, the country will fail to reap the benefits of its demographic dividend.
