Union government of India has already notified the four labour codes and intend to roll out their full implementation from April 1, 2026, while the joint platform of the 10 Central Trade Unions (CTUs) has demanded for their withdrawal and are going for a one day all India strike on February 12 against the codes, alleging them anti-worker and pro-corporate.

“Effective implementation of Labour Codes would play a key role in supporting formal employment and improving security for women and gig workers. As definitions of work continue to evolve, dynamic labour policy and flexible regulatory frameworks would ensure employment expansion, worker security and well-being,” says the Economic Survey.

On the skills front, the Economic Survey says, flexible vocational pathways starting at the school level will be required. As India moves ahead in its growth journey, advancing institutional convergence and fostering a whole-of-government approach would enable the skilling and employment initiatives to operate in a coherent manner. The development of an information system that brings together data from e-Shram on unorganised workers, NCS on job vacancies and required skills, and SIDH on training opportunities can lay the foundation for an integrated digital public infrastructure. This could set the stage for a sharper emphasis on industry-driven skilling, which remains central to building job-ready talent and strengthening skill-industry linkages.

The labour markets in India are undergoing significant structural transformations driven by digitalisation, green energy transition, and emerging forms of employment such as gig and platform work. In the post-pandemic growth phase, the emphasis has shifted from the quantity of jobs to the quality of work.

It mentions expansion of working age (15-59 years) population which will be 98 crore in 10 years and it to peak by 2030, and says it presents opportunities on the one the one hand and challenges for the labour markets and social support systems. Realising this dividend requires policies that extend health spans through preventive healthcare, healthy lifestyles, and management of non-communicable diseases (NCDs), alongside financial support, accessible healthcare, and social services for older adults. Epidemiological reports also indicate a rise in NCDs such as cardiovascular disorders, diabetes, and mental health challenges among the productive age groups.

While the Economic Survey 2024-25 highlighted the need for deregulation in the labour market to enable a virtuous cycle of job creation and the need to address the skill mismatch in the labour market to improve the employability of the workforce, the Economic Survey 2025-26 has discussed the role of education, healthcare, community development, and infrastructure development in enhancing human capacity and promoting social mobility. It also highlights how the state can effectively utilise these policy tools to achieve more equitable outcomes.

On the supply-side policy levers to support inclusive employment development, an analysis of the employment landscape of the economy and the drivers of a more inclusive labour market has been presented – in three distinct sections. First, the state of employment, focusing on the sectoral and gender distribution of the workforce and discusses policy suggestions. Secondly, how the recently notified Labour Codes can lead to job creation. Thirdly, the challenge of re-strategising the vocational education framework to prepare the youth for the evolving demands of industry.

The Economic Survey says that e-Shram portal is steadily bridging the gap between informal and formal employment. As of January 2026, the portal has successfully registered over 31 crore unorganized workers, marking a significant advancement in India’s efforts to formalise and support its informal workforce. The platform facilitates the delivery of social security and welfare schemes to registrants. It also says that NCS is a one-stop solution connecting job seekers, employers, training providers and career guidance and counselling agencies.

As for the four Labour Codes – Code on Wages 2019, Industrial Relations Code2020, CSS 2020 and Occupational Safety, Health and Working Conditions Code 2020–the Economic Survey says that these have attempted to strike a balance between regulation and flexibility. It falsely says, “They are a result of the deliberations held in the tripartite meeting of the government, employers, industry representatives, and various trade unions from 2015 to 2019.” The reality is that the codes have never been discussed at the apex tripartite body Indian Labour Conference, and the joint platform of the CTUs deny any such discussion.

Implementing the Codes marks the first step towards the labour market transformation, says the Economic Survey. However, the transition will require coordination and investment from the private sector. Companies must enhance their systems, update policies, reevaluate workforce models, and improve their digital readiness to remain competitive. While the Codes offer a unified framework, it is up to the private sector to integrate this framework into daily operations. It clearly indicates that the workforce will be on the mercy of the private employers, an allegation that CTUs have made and are on the war path against implementation of the codes.

The Economic Survey says, India's labour market is transforming due to factors such as economic policies, technological progress, and the evolving demands of the labour market. As a result, traditional employment paradigms are yielding to hybrid models that blend contract and formality. These factors also shape the way key players in the labour market interact, specifically the employer and the employee. The changing dynamics of this interaction occur in the context of the preferences of these two agents, where one wants to maximise its revenue and minimise cost, and the other wants to maximise its pay. … With the growth of the gig economy, these features are evolving further: jobs are more flexible, payments are digital, and traditional employer-employee interactions are less defined.

Expanding access to skills and improving their quality requires a well-integrated skilling ecosystem, the Economic Survey says. India needs a well-integrated and forward-looking skilling system which is critical to enabling the workforce to capitalise on emerging economic opportunities. As learners advance, education and vocational pathways must be closely aligned with industry, ensuring that curricula, pedagogy, and assessment reflect the real-world requirements and evolving demands of the workplace. (IPA Service)