The state of Gujarat has implemented a series of significant wage revisions and labour policy changes over the last few years, reflecting a major shift in its approach to worker welfare and industrial regulation. From a landmark wage increase in 2023 to a comprehensive revision effective from April 2025, these updates affect millions of workers across categories and sectors.
Major Wage Increase in 2023
In March 2023, the Gujarat government announced an approximate 25% increase in minimum wages for workers in multiple employment categories, including skilled, semi-skilled, and unskilled labourers.
Under the revised structure, a skilled worker in municipal areas saw wages rise from around ₹9,887.80 to ₹12,324 per month — an increase of nearly 24.6%. Similarly, unskilled workers in non-urban areas experienced a rise from approximately ₹9,445.80 to ₹11,752 per month, an increase of about 24.4%.
This revision came after nearly a decade with no major change in many categories, the last such update having taken place in 2014. The government stated that the revision would benefit around two crore workers across the state, marking one of the largest wage hikes in recent years.
New Minimum Wages Effective April 1, 2025
In March 2025, Gujarat notified revised minimum wages that took effect on April 1, 2025. The new rates introduced a structured system combining Basic Pay + Variable Dearness Allowance (VDA) to better reflect inflation and the cost of living.
Below are some examples from the revised wage schedule:
| Worker Type / Zone | Basic (₹/day) | VDA (₹/day) | Total (₹/day) | Approx. Monthly Total (₹) |
|---|---|---|---|---|
| Unskilled, Zone I | 452 | 45.50 | 497.50 | 12,935 |
| Unskilled, Zone II | 441 | 45.50 | 486.50 | 12,649 |
| Semi-skilled, Zone I | 462 | 45.50 | 507.50 | 13,195 |
| Skilled, Zone I | 474 | 45.50 | 519.50 | 13,507 |
| Skilled, Zone II | 462 | 45.50 | 507.50 | 13,195 |
“Zone I” covers urban and municipal areas under corporations and development authorities, while “Zone II” includes rural and non-urban regions.
This wage structure aims to balance urban–rural disparities and maintain parity between industrial zones.
Special Allowance Revision (October 2025 – March 2026)
In October 2025, the Labour Commissioner of Gujarat revised special daily allowances applicable from October 2025 to March 2026 for 46 scheduled occupations and six sector-specific categories such as brick manufacturing, salt production, garments, and agriculture.
Key revised rates included:
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Scheduled occupations (ship breaking, sweeping, cleaning, etc.) – ₹148.50 per day
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Sector-specific occupations (salt, agriculture, etc.) – ₹134.00 per day
These allowances are linked to inflation and reviewed periodically to maintain workers’ real income levels.
Contract Labour Wage Revision (October 2024 – March 2025)
Earlier, from October 2024 to March 2025, Gujarat’s Labour Commissionerate revised contract labour wages for both skilled and unskilled categories. The revised daily wages were as follows:
| Type of Labour | Zone 1 (₹/day) | Zone 2 (₹/day) |
|---|---|---|
| Skilled | 474 | 462 |
| Semi-skilled | 462 | 452 |
| Unskilled | 452 | 441 |
Additionally, a small cost-of-living allowance (COLA) adjustment was made, with a minor decrease of ₹1 in certain categories.
Change in Working Hours and Factory Norms
In 2025, the Gujarat government amended provisions of the Factories Act, allowing for 12-hour work shifts (with a cap of 48 hours per week). The amendment also permitted women to work during night shifts, subject to safety provisions.
This reform represents a significant departure from earlier rules that imposed stricter limits on daily working hours. The government stated that this measure was intended to provide greater flexibility to industries while ensuring that weekly working hours remain within statutory limits.
Labour Force Participation and Employment Trends
According to official data, Gujarat’s labour force participation rate (LFPR) rose from 39.6% in 2018–19 to 48.1% in 2022–23, indicating a strong increase of 8.5 percentage points. Meanwhile, the unemployment rate for the 15–59 age group dropped from 3.4% to 1.8% during the same period.
These figures suggest a healthier labour market and a growing number of individuals entering the workforce.
Concerns and Industry Reactions
While the wage revisions were welcomed by worker unions and labour advocates, industry groups such as the Gujarat Chamber of Commerce & Industry (GCCI) voiced concerns that the sharp wage hikes could impact the profitability of small and medium enterprises (SMEs).
Some employers fear potential layoffs or cost-cutting measures, especially in sectors heavily reliant on manual labour. Additionally, labour experts have pointed out that implementation and enforcement of the revised wages remain a challenge, as many informal establishments continue to underpay workers despite official notifications.
Interpretation and Implications
The wage reforms in Gujarat represent a major policy shift after nearly a decade of stagnation. The introduction of a “basic + VDA + special allowance” structure aligns state wages more closely with cost-of-living inflation, offering greater protection to low-income workers.
However, concerns remain regarding the practical enforcement of these minimums, particularly in smaller and informal units. Furthermore, while higher wages can improve worker welfare, they may also raise operational costs for industries, potentially affecting hiring patterns.
The broader increase in labour participation and the introduction of flexible working-hour rules indicate a state-level push to modernize Gujarat’s labour ecosystem — but ensuring fair and timely wage distribution will remain the central test of these reforms.