India's formal workforce is increasingly being shaped by young workers.
According to Pulse FY2026: Shaping India's Workforce Future, Employment Insights and Quess Corp's Impact, released by Quess Corp, nearly 59% of all new Employees' Provident Fund Organisation (EPFO) subscribers in FY25 belonged to the 18-25 age group, signalling a significant shift in the composition of the country's organised workforce.
The report, which analyses EPFO, Periodic Labour Force Survey (PLFS) and industry data, suggests that first-time entrants are becoming the primary source of formal employment growth as businesses invest in skills development, apprenticeships and technology-enabled hiring models.
Young professionals dominate new workforce registrations
The trend extends beyond EPFO enrolments.
Quess Corp reported that of the more than 57,000 new Universal Account Numbers (UANs) generated during FY26, 79% belonged to individuals aged 18-30.
Among all age groups, workers aged 21-25 accounted for more than 35% of new UANs, making them the single largest cohort entering formal employment.
The findings point to a labour market increasingly driven by younger talent, with organisations focusing on improving the transition from education to employment through structured entry pathways.
Key workforce indicators highlighted in the report include:
59% of new EPFO subscribers in FY25 were aged 18-25
79% of new UANs in FY26 belonged to individuals aged 18-30
Workers aged 21-25 accounted for over 35% of all new UANs
69% of the workforce is deployed across Tier 2 and Tier 3 cities
96% of workers have completed at least Class 10 education
61% have completed Class 12 or higher
30% hold graduate or postgraduate qualifications
Apprenticeships gain importance in employability efforts
The report highlights the growing role of apprenticeship programmes in helping young people enter the workforce.
According to Quess Corp, nearly 64,000 apprenticeship contracts were facilitated under the National Apprenticeship Promotion Scheme (NAPS). The automotive sector accounted for more than 51% of all apprenticeship contracts, making it the largest contributor.
Lohit Bhatia, Executive Director and Group CEO of Quess Corp, said the rapid entry of young workers into formal employment is reshaping workforce priorities for both employers and policymakers.
"The scale at which young people are entering India's formal workforce marks a defining shift for both employers and the economy," he said.
Bhatia noted that organisations must increasingly focus on employability, industry-relevant skills and workplace readiness, with apprenticeships serving as a key route into long-term careers.
Emerging cities strengthen their role in organised employment
The report also points to the growing significance of non-metro markets in India's employment landscape.
Nearly 69% of the workforce covered by the report is deployed across Tier 2 and Tier 3 cities, reflecting the rising importance of emerging economic centres in generating organised employment opportunities.
The data suggests workforce formalisation is spreading beyond major metropolitan regions as businesses expand operations and talent sourcing into smaller cities.
At the same time, the workforce is becoming more educated. Quess Corp found that educational attainment levels continue to improve, with a majority of workers completing higher secondary education and a growing share holding graduate qualifications.
Women’s participation rises, but challenges remain
Women represented a significant share of new workforce entrants during FY26.
The report found that:
28% of new UANs were generated by women
26% of apprenticeship contracts were awarded to women
However, the report also highlighted continuing structural challenges.
Despite progress in workforce formalisation, India's youth NEET (Not in Employment, Education or Training) rate stood at 24.8% in 2025, underlining the need for stronger skilling programmes and workforce participation initiatives.
The findings suggest that while formal employment opportunities are expanding, a substantial proportion of young people remain disconnected from both education and work.
Workforce development becomes the next priority
The report concludes that India's demographic advantage is increasingly translating into formal workforce growth. Yet the next phase will depend on how effectively employers, educators and policymakers strengthen employability pathways.
With young workers now accounting for the majority of new formal workforce entrants, apprenticeships, industry-led skilling and job-readiness programmes are expected to play a larger role in shaping India's future labour market.