India’s Unincorporated Non-Agriculture Establishments Rise 9.2% in Q1 FY27, Employment Reaches 13.7 Crore

India’s unincorporated non-agricultural sector continued to expand during the April-June 2026 quarter, with the estimated number of establishments rising 9.2% year-on-year to 8.67 crore, according to the latest Quarterly Bulletin of Unincorporated Sector Enterprises released by the National Statistical Office under the Ministry of Statistics and Programme Implementation.

The number of establishments increased from 7.94 crore in April-June 2025 to 8.67 crore in April-June 2026. Employment also strengthened, rising 6.55% from about 12.86 crore workers to 13.70 crore workers during the quarter.

The other services sector emerged as the main employment driver, recording workforce growth of more than 21%. Manufacturing also performed strongly, with the estimated number of establishments increasing 10.06% and employment in the sector growing 6.60% year-on-year.

Trade, however, recorded a contraction during the quarter. The estimated number of unincorporated trade establishments fell 7.88% year-on-year, while employment declined 10.29%. Some caution is required when comparing individual sectors because the 2026 survey adopted the new NIC-2025 industrial classification, which shifted certain activities between categories.

Urban India accounted for much of the employment expansion. Employment in urban unincorporated enterprises grew by more than 12% year-on-year, compared with growth of just 0.70% in rural areas. Urban establishments themselves increased by about 15.33%, highlighting the growing role of small enterprises and self-employment in India’s cities.

Women accounted for more than 30% of the total workforce in the sector during the quarter. At the same time, working owners remained the largest category of workers, representing 62.38% of employment, up from 60.18% a year earlier. The share of hired workers declined from 24.38% to 22.77%, showing that much of the sector continues to consist of small, owner-operated businesses.

Digital adoption also continued to deepen. Around 82% of establishments used the internet for business purposes, while nearly 80% accepted cashless transactions through mechanisms such as UPI, online banking and point-of-sale systems. The share of enterprises registered under an Act or authority rose to 42.5%, more than seven percentage points higher than in the corresponding quarter of 2025.

The unincorporated non-agricultural economy covers millions of small manufacturers, traders and service providers outside the incorporated corporate sector and remains one of India’s largest sources of employment and entrepreneurship. The latest figures point to continued expansion during the first quarter of FY2026-27, particularly in services, manufacturing and urban enterprises, even as global economic uncertainty persists.