Labor market in Nepal

Nepal's labour market includes people supplying work, companies and institutions seeking workers, self-employed people, household enterprises and public employment programmes. The Ministry of Youth, Labour and Employment, the National Statistics Office, the Department of Labour and Occupational Safety, the Department of Foreign Employment and local governments share responsibilities across policy, data, labour protection, foreign employment and service delivery. The 2021 National Population and Housing Census recorded economic activity during the previous 12 months for 14,983,310 people aged 10 and above. It counted 11,038,105 people as usually economically active, including 10,270,447 usually employed people, or 93.05% of the active group, and 767,658 usually unemployed people, or 6.95%. The 2022/23 household living-standards survey provides a newer household and labour snapshot. The fourth Nepal Labour Force Survey was still collecting data when the research was completed, so its results were not available. Older labour-force figures should not be treated as current estimates. Agriculture, forestry and fishing accounted for 57.3% of employment in the census-based structure. Wholesale and retail trade, including motor-vehicle repair, accounted for 12.5%; construction for 8.1%; other services for 3.9%; and manufacturing for 3.8%. By institutional sector, household enterprises accounted for 61.8% of work, non-financial companies for 32.7%, government for 3.9%, financial companies for 1.1% and non-profit institutions for 0.4%. This structure helps explain why own-account work and informal arrangements remain widespread. The main occupational groups were skilled agriculture, forestry and fishery work at 50.1%, elementary work at 23%, service and sales work at 5.8%, craft and related trades at 5.6%, managers at 5.1%, professionals at 3.8%, plant and machine operators at 2.7%, technicians and associate professionals at 1.9%, clerical work at 1.3% and armed forces work at 0.7%. By work status, 55.3% were own-account workers, 28.6% employees, 14.5% contributing family members and 1.4% employers. The older 2017/18 labour-force survey estimated that 62.2% of the formal-sector and informal-sector split was informal-sector activity and 37.8% formal-sector activity. Using its separate employment definition, 84.6% of employment was informal and 15.4% formal. These figures use definitions that differ from newer surveys. The same historical survey recorded a labour-force participation rate of 38.5%, with 53.8% for men and 26.3% for women; unemployment was 11.4%, with 10.3% for men and 13.1% for women; and labour underutilization was 39.2%. Median monthly employee earnings were Nepalese rupees (NPR) 15,208, compared with NPR 18,000 for men and NPR 12,000 for women. These earnings are historical indicators, not the current statutory wage floor. Regional opportunities differ across Nepal's seven provinces. Bagmati has the highest concentration of diversified wage work, services and industry. Madhesh has a stronger agricultural concentration. Gandaki has particular relevance for accommodation and tourism. Karnali and Sudurpaschim have lower economic diversification and greater access constraints. Province, district and local-level data can show more detail, but Nepal has no single regional pay pattern that applies everywhere. Technical and vocational education connects some workers to the labour market. The Council for Technical Education and Vocational Training, known as CTEVT, offers diploma and Proficiency Certificate Level programmes, pre-diploma and Technical School Leaving Certificate programmes, short courses and apprenticeship or dual programmes. Diplomas commonly last three years. Pre-diploma programmes commonly use formats such as 12 months plus six months of on-the-job training or longer three-plus-one-year arrangements, depending on the programme. Short courses commonly last about 140 to more than 550 hours. Entry may require passing or appearing in the School Education Examination or the older School Leaving Certificate, together with programme-specific grades or an entrance test. Fees and available places vary by institute. The National Skill Testing Board provides skill testing and certification, while the Nepal Vocational Qualifications System is being built and transitioned; it is not a universal mandatory licence system. Job matching is available through the Department of Labour's public Jobkhoj portal, Employment Service Centres at all 753 local levels, the CTEVT Training Information Portal, private referrals and informal networks. The Prime Minister Employment Programme and the National Employment Promotion Programme register unemployed people for short-term public works or cash-for-work and have a policy target of 100 days. Self-employment is also a major pathway. Registration or training does not create automatic job placement, and access is affected by education, gender, province, internet connectivity and migration decisions. For employees, the Labour Act 2074 provides the statutory framework for minimum standards, contracts, remuneration from the start of work, leave, social security and occupational safety and health. From 1 Shrawan 2082, the listed minimum remuneration is NPR 19,550 per month outside tea estates, made up of a basic wage of NPR 12,170 and a dearness allowance of NPR 7,380. The equivalent rates are NPR 754 per day, NPR 101 per hour and NPR 107 per hour for part-time work. The Department of Labour and Occupational Safety handles inspection and compliance. A wage below the statutory floor is not valid where the law applies, but informal and self-account work often receives less effective protection. Foreign employment is a major labour-market pathway. In 2023/24, Nepal issued 460,102 new labour approvals and 741,297 approvals including renewals. Women accounted for 12.9% of new approvals. Approvals covered 148 countries, including 281,849 new approvals for Gulf Cooperation Council countries and 81,382 for Malaysia. Madhesh, Koshi, Lumbini and Bagmati were leading origin provinces. Migration supports household income through remittances, but it also reduces domestic labour supply and exposes workers to recruitment charges, false contracts, safety risks and policy changes in destination countries. The foreign-employment process uses the Department of Foreign Employment and the Foreign Employment Information Management System, or FEIMS. A worker normally completes the online form, pre-departure orientation training, a health test, insurance, social-security and welfare payments, and labour approval. The passport generally needs at least 90 days of validity, and the file requires a valid visa, contract and employer evidence. A worker may use an individual process, a licensed agency or a government-to-government pathway. The Department of Foreign Employment provides foreign-job searches and a complaint system. Listed age-based insurance amounts are NPR 3,708 for ages 18 to 35, NPR 4,931 for ages 36 to 50 and NPR 9,463 for ages 51 to 64, in addition to NPR 2,308 for social security and NPR 1,500 for welfare. Health, training and recruitment costs vary. Unlicensed agents and false documents can leave a worker without secure legal or financial protection. Nepal's labour-market development remains closely tied to migration and remittances, while domestic quality-job creation is constrained. The National Employment Promotion Programme from fiscal year 2082/83 combines public employment, skills, entrepreneurship and formalization measures. Hydropower, tourism, digital services, manufacturing, agro-processing and export-linked sectors are identified as priority growth and employment areas. These areas indicate policy and economic opportunities, not guaranteed vacancies or income.