Future of work: India’s youth under the new Codes, Pg7

Key Highlights:

• India's Labour Codes, consolidating 29 central laws, came into force in November 2025, aiming to simplify compliance and modernize workplace regulations.
• In 2024, India's median age was under 30, but youth unemployment stood at 10.2% according to the PLFS 2023-24, significantly higher than older adults.
• The Labour Codes aim to formalize the economy and improve ease of doing business, potentially raising earnings for young workers in entry-level jobs.
• The Code on Social Security extends welfare schemes to unorganized, gig, and platform workers, offering clearer institutional mechanisms than the 2008 Act.

Detailed Insights:

• India's pre-consolidation labor regime was fragmented, leading to uneven enforcement and most protections applying only to the formal sector.
• Despite India's demographic advantage, youth employment faces challenges including low labor force participation and high unemployment rates.
• Gender disparities exacerbate these issues, with significantly lower labor force participation among young women and higher unemployment in urban areas.
• Young workers are disproportionately concentrated in informal employment, often lacking social security and written contracts.
• The Labour Codes mandate parity in wages and benefits for fixed-term contract workers and strengthen employment security through appointment letters and guaranteed wage payments.
• The Industrial Relations Code reduces hiring frictions and extends benefits to fixed-term employees, but challenges remain in coverage for unorganized and gig workers.
• Gaps in coverage persist due to size-based definitions of enterprises and discretionary language in provisions for gig workers, complicating effective policy implementation.
• Stronger labor data systems and proactive worker registration are needed to address these gaps and strengthen policy design and protection for young workers.

Key Concepts Involved:

• Labour Codes: Consolidated laws simplifying compliance, universalizing minimum wages, expanding social protection, and modernizing workplace regulation.
• Periodic Labour Force Survey (PLFS): A survey providing estimates of key employment and unemployment indicators in India.
• Gig Economy: A labor market characterized by short-term contracts or freelance work, often facilitated by digital platforms.