Rising youth NEET rates show that unemployment figures alone understate labour-market exclusion. Discuss with reference to India.

The unemployment rate counts only young people who are actively looking for work. The NEET rate (Not in Employment, Education or Training) also counts those who have stopped looking or never entered the labour force. In 2025, global youth unemployment was 12.4%, but 20% of young people, more than 257 million, were NEET [1]. India shows this gap even more sharply.

Why unemployment figures understate exclusion

• Discouraged workers disappear: young people who stop searching leave the labour force, and so they drop out of the unemployment rate.
• Women are hidden: women make up over two-thirds of NEET youth worldwide [1]. In India, care work and social norms keep many young women outside the labour force, so they are never counted as "unemployed".
• Low rate, high idleness: an economy can report modest unemployment while a large share of its youth is idle.

The Indian evidence

• Two different stories: PLFS 2025 puts youth (15–29) unemployment at 9.9% [2], and the government says India's rate is below the global level [3]. Yet India's youth NEET rate was 24.7% in 2024, against a G20 average of 17.6% [4].
• Educated unemployment: the share of unemployed youth with secondary or higher education rose from 35.2% (2000) to 65.7% (2022) [5]. This points to a mismatch between skills and jobs.
• Urban distress: urban youth unemployment (13.6%) is far higher than rural (8.3%) [2]. In rural areas, underemployment is hidden in family farms.
• Demographic dividend at risk: idle youth add little to output or savings, so the dividend can turn into a burden.

Caveats

• NEET also includes young people who are caring for family or preparing for competitive exams. Not all of them are shut out by the market.
• Age bands differ (PLFS uses 15–29, ILO uses 15–24), so comparisons need care.

Way forward

• MoSPI should publish a NEET rate next to unemployment in every PLFS release.
• Align Skill India and apprenticeships with what employers need, and expand childcare and care services so more young women can work.
• Create more productive non-farm jobs, especially in manufacturing, as the India Employment Report 2024 recommends [5].

Unemployment and NEET rates are both needed to see the true scale of youth exclusion. If India tracks NEET openly and links skilling to real jobs, it can meet SDG 8's goal of decent work and turn its young population into a real dividend.