India’s Services Employment Share Rises to 30%, Adds 40 Million Jobs in Six Years: NITI Aayog

India’s services sector has solidified its position as the country’s most dynamic employment engine, with its share in total employment increasing to nearly 30% in 2023–24, according to two new reports released by NITI Aayog. The sector has generated about 40 million new jobs over the past six years, underscoring its growing role in shaping India’s transition toward a developed economy.

Services Sector Driving India’s Economic Transformation

NITI Aayog’s reports, ““India’s Services Sector: Insights from Employment Trends and State-Level Dynamics”” and ““India’s Services Sector: Insights from GVA Trends and State-Level Dynamics,”” highlight that the services employment share rose from 26.9% in 2011–12 to 29.7% in 2023–24. Total services employment now stands at around 188 million. Despite this robust expansion, India’s services share still lags behind the global average of 50%, signalling ongoing structural shifts in the economy.

Post-Pandemic Employment Elasticity Shows Strong Recovery

The reports reveal that gross employment elasticity in the services sector — a measure of how responsive employment is to growth — improved sharply from 0.35 before the Covid-19 pandemic to 0.63 in the post-pandemic period. This indicates a stronger correlation between output growth and job creation, reflecting resilience and adaptability in India’s services ecosystem.

Modern Services Emerging as Key Job Creators

While traditional sectors such as trade, transport, and repair continue to dominate overall employment, modern services — including finance, information technology, and professional business services — are driving new opportunities. These industries are characterised by higher productivity, better wages, and strong global linkages, positioning them as future growth pillars in India’s employment landscape.

Exam Oriented Facts

• India’s services employment share rose from 26.9% (2011–12) to 29.7% (2023–24).
• The sector added 40 million jobs in six years, reaching 188 million workers.
• Gross employment elasticity increased from 0.35 pre-Covid to 0.63 post-Covid.
• Global average for services employment stands at around 50%.

Regional Disparities and Roadmap for Viksit Bharat 2047

The findings also underscore significant regional variation. Southern and western states lead in modern services employment, while smaller and northeastern states depend more on education, health, and public administration. NITI Aayog stated that these insights will guide the “Viksit Bharat 2047” roadmap, helping to design state-specific and sector-focused strategies aimed at accelerating service-led growth and expanding employment opportunities nationwide.