Industry Is Growing, but Isn't Creating Jobs: ASI 2024-25

Source: Original editorial ↗ The Indian Express

The Lift Line

“Manufacturing in India has not emerged as an engine of mass employment, unlike in the development trajectory of Asian economies such as Korea and China.”

Why This Editorial Matters for Your Exam

The Indian Express’s unsigned editorial of 2 October 2026 reads the Annual Survey of Industries (ASI) 2024-25, released on 30 September and summarised in our 1 October roundup. It turns a data release into the central GS3 question: growth versus jobs.

GS Paper 3: Indian economy and issues relating to growth, development and employment; industrial policy.

Background and Context

Indicator	Figure	Source cited
Registered manufacturing output growth, 2024-25	7.8%	ASI
Employment growth, 2024-25	7.2%	ASI
Emoluments growth, 2024-25	12.08%	ASI
Persons engaged	Over 2 crore in 2024-25; 1.72 crore in 2021-22	ASI
Non-farm workers in informal-sector enterprises	73.1%	PLFS 2025
Organised vs unorganised manufacturing jobs, 2023-24	About 1.9 crore vs 3.3 crore	Economic Survey

What the ASI covers. The ASI, conducted by the National Statistics Office (MoSPI), covers factories registered under the Factories Act, 1948 (10 or more workers with power, 20 or more without), bidi and cigar establishments, and certain electricity units. It does not cover unorganised manufacturing.

The Analysis

1. Healthy, but narrow. The formal sector is growing: output, employment and wages all rose in 2024-25. But it employs only a fraction of the workforce.

2. Capital over labour. Wages per worker have grown slower than net profit, output per worker has stayed roughly flat, and invested capital has risen steadily. Growth is coming more from capital than from hiring and productivity.

3. The small-firm problem. Organised manufacturing is dominated by small firms, though bigger factories (over 100 workers) employ more people, pay higher wages and are more productive, the Economic Survey notes.

4. No ladder out of farming. Without factory jobs, the low-skilled and unskilled either stay on the farm or take up gig work. The editorial calls this “India’s employment challenge”.

Data and Institutions Vault

Prelims-grade facts:

ASI 2024-25:

• Output +7.8%, employment +7.2%, emoluments +12.08% in registered manufacturing.
• Persons engaged: over 2 crore (1.72 crore in 2021-22).
• Conducted by NSO, MoSPI, under the Collection of Statistics Act, 2008.

Labour data:

• PLFS 2025: 73.1% of non-farm workers in informal-sector enterprises.
• PLFS is conducted by the NSO; it replaced the NSSO’s quinquennial employment surveys in 2017.

⚠️ Watch the trap: The ASI covers only registered factories; the IIP measures monthly production volume. A rise in ASI employment says nothing about the far larger unorganised manufacturing workforce.

The Debate

For the editorial’s view. Successive governments’ efforts have not moved manufacturing’s share of GDP or employment much; the dual structure persists.

The complications. Formal jobs did rise sharply; automation means today’s factories need fewer workers than 1980s Korea or 2000s China; services and construction also absorb labour.

The balanced verdict. The question is not whether to grow manufacturing but which manufacturing: labour-intensive sectors and firms that can scale.

How to Think About This

Watch the ratios, not the totals. Output, jobs and wages can all grow while wages per worker lag profits and output per worker stagnates. Those ratios tell you whether growth is inclusive.

Diagram-in-Words

Takeaway Box

• ASI 2024-25: output +7.8%, jobs +7.2%, emoluments +12.08%; over 2 crore engaged.
• But: 73.1% of non-farm workers in informal enterprises (PLFS 2025).
• Why: capital deepening, small firms, flat output per worker.
• Result: low-skilled workers stay on farms or turn to gig work.

Sources: The Indian Express, MoSPI, ASI 2024-25

Source: Industry Is Growing, but Isn't Creating Jobs: ASI 2024-25 — Ujiyari.com | Free UPSC & State PCS Editorial Analysis

Key Arguments at a Glance

The Indian Express argues that India’s formal manufacturing is growing at a healthy pace, as the Annual Survey of Industries 2024-25 shows, but it has not become an engine of mass employment; most workers remain informal, leaving the low-skilled with farm work or gig work.

✓ Supporting

• In 2024-25 registered manufacturing output grew 7.8%, employment 7.2% and emoluments 12.08%, but wages per worker grew slower than net profit, output per worker barely changed and invested capital kept rising.
• Persons engaged in organised manufacturing crossed 2 crore in 2024-25, up from 1.72 crore in 2021-22, yet 73.1% of non-farm workers were in informal-sector enterprises according to the PLFS 2025.
• In 2023-24, about 1.9 crore people worked in organised manufacturing against about 3.3 crore in the unorganised segment, according to the Economic Survey.
• Organised manufacturing is dominated by small firms, although larger factories (over 100 workers) employ a larger share of workers, pay more and are more productive.

⚠ Counter

Ujiyari’s synthesis: formal manufacturing jobs did rise faster than in many past years, services and construction are absorbing labour, and capital deepening raises productivity that can fund higher wages over time; the case that manufacturing alone must absorb the workforce may be outdated in an era of automation.

→ Way Forward

The editorial diagnoses rather than prescribes. Ujiyari’s synthesis: help firms grow past the small-firm trap (labour code implementation, easier compliance), back labour-intensive sectors such as textiles, footwear, food processing and electronics assembly, link skilling to industry demand, and improve urban infrastructure and worker housing near industrial clusters.