Odisha surpasses national average in labour force participation, shows strong employment gains

Odisha has outperformed the national average, achieving substantially higher levels of labour force participation, with the State showing improvement in key employment indicators, particularly the labour force participation rate (LFPR) and worker population ratio (WPR), the Odisha Economic Survey (OES) 2025–26 pointed out.

Between 2022 and 2024, the State recorded a significant increase in its LFPR, rising from 58.1 per cent to 64.5 per cent, an increase of around 6.4 percentage points.

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Over the same period, the national LFPR increased from 56.1 per cent to 59.6 per cent, reflecting a rise of 3.5 percentage points, the OES stated.

As mechanisation and enterprise-focused AI tools continue to reshape industries, it is important to consider how employment patterns are evolving. Odisha is currently reaping its demographic dividend, and over the next decade, nearly 70 per cent of its population is expected to fall within the working-age category.

Understanding the current employment landscape will help shape policies that enable the workforce to build skills, adapt, and benefit from emerging economic and technological opportunities, the survey report noted.

In 2024, Odisha had a population of 3.56 crore individuals aged 15 and above, of whom 2.29 crore were part of the labour force, either employed or actively seeking work. Of these, 2.22 crore were employed.

A closer look at the composition of employment reveals that self-employment dominates the labour market, with 1.37 crore individuals engaged in such activities. The remaining workforce comprises regular salaried workers (0.32 crore) and casual labourers (0.53 crore).

This improvement is evident across gender categories as well. The female labour force participation rate (FLFPR) in Odisha increased from 37.6 per cent in 2022 to 48.7 per cent in 2024, surpassing the national average of 40.3 per cent.

Furthermore, Odisha recorded one of the highest FLFPRs in the country at 48.7 per cent. This rise in female participation has helped narrow the gender gap in the labour market from 41 per cent to 32.9 per cent in 2024, enhancing women’s engagement in employment.

The worker population ratio (WPR) in the State has also shown significant improvement, rising from 55.1 per cent to 62.5 per cent, and now exceeds the national average of 57.7 per cent.

As the State experiences a demographic dividend, with a substantial proportion of its population in the working-age group, this trend reflects an encouraging development.

In addition, the unemployment rate declined to 3.1 per cent in 2024 from 5.1 per cent in 2022, placing the State broadly in line with national levels.

However, the size of the labour force alone is not the primary driver of economic growth; equally important are the quality of employment and the extent of social and income security it offers.

Nearly half of the workforce is concentrated in agriculture (48.6 per cent), followed by industry (27.5 per cent) and services (23.9 per cent). Moreover, self-employment accounts for the dominant share of the workforce (62.7 per cent), followed by casual employment (24.1 per cent), while regular salaried employment constitutes about 13.2 per cent, the OES added.