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The number of self-employed small traders and unregistered business owners is increasing in India, but these individuals are earning less than workers working on a minimum wage, according to the latest report of the National Statistical Office (NSO) under the Union Ministry of Statistics and Program Implementation.
The Annual Survey of Unincorporated Sector Enterprises (ASUSE) 2025 provides detailed information on the functioning and economic health of small and unincorporated businesses in the non-agricultural sector. It includes key business statistics and economic indicators.
To prepare this report, a survey of 670,650 establishments across the country was conducted between January 2025 and December 2025. These included 294,318 establishments in rural areas and 376,332 establishments in urban areas.
The report shows that the number of small and unincorporated businesses in India is steadily increasing. By 2025, the number of such businesses is projected to reach 79.2 million, compared to 73.4 million in the previous survey, conducted in 2023-24. This means that more than 5.8 million new small and micro businesses were started in a single year.
This growth comes at a time when employment growth in the organised sector remains relatively slow. This means that a significant number of people are earning their livelihoods through small shops, household units, self-employment, repair work, local services, and small businesses.
The sector created nearly 7.5 million new jobs over the past year. According to the report, the non-agricultural unincorporated sector employed approximately 128.1 million people between January and December 2025, including self-employed individuals, salaried employees, unpaid family members, and other workers.
Compared to 2023-24, employment increased by 6.2 per cent, with approximately 7.45 million new jobs added. The number of workers in rural areas increased from 56.1 million to 60 million, and in urban areas from 64.5 million to 68 million. During this period, employment growth was 6.9 per cent in rural areas and 5.6 per cent in urban areas, while cities’ share of total employment slightly exceeded rural employment.
While the growth in the number of businesses may be seen as a sign of economic activity, the report also shows that the income, productivity and social security of these small businesses remain extremely weak.
“The average gross value added (GVA) per establishment during the survey period was recorded at Rs 2.5 lakh,” the report said. The average GVA per worker was recorded at Rs 1.6 lakh.
This means that most businesses in the unincorporated sector operate on a very small scale and have a limited number of workers per unit. If an establishment generates an average GVA of only Rs 2.5 lakh per year, this translates to approximately Rs 20,800 per month and approximately Rs 685 per day.
The average GVA per worker is Rs 1.6 lakh annually, or approximately Rs 13,300 per month and Rs 440 per day. This isn’t the worker’s actual income, but rather the total economic value they generate, which also includes raw materials, rent, electricity, transportation, and other expenses.
It’s worth noting that in most states, the minimum wage is Rs 15,000 or more. This means that small businesses and their workers are earning less than the minimum wage.
As for workers’ emoluments, the report said the average annual emolument per hired worker in the unincorporated non-agricultural sector ranged from around Rs 1.4 lakh to Rs 1.5 lakh. It was Rs 140,809 in manufacturing, Rs 144,500 in trade, and Rs 151,122 in other services.
On a monthly basis, this works out to an average of around Rs 12,000 to Rs 13,000 per month. This means that millions of unincorporated workers in the country are still working on incomes that are considered extremely limited compared to rising inflation and the cost of living.
While it is not as easy for small businesses to access loans as it is for large businesses, these businesses remain trapped in a debt trap. According to the report, the average outstanding debt per establishment in the unincorporated, non-agricultural sector is estimated at approximately Rs 42,776.
According to the report, about 80 per cent of loans came from banks and other institutional sources, but the average loan amount per business is quite low, indicating that small businesses are still not receiving adequate financial support.
Due to limited capital and limited credit, they are unable to invest in new machinery, technology, or expand their business. This is why most small businesses in the unincorporated sector remain trapped in the confines of low revenues and slow economic growth.
