Rwanda’s unemployment rate declined to 13.4 per cent in the second quarter of 2025, down from 16.8 per cent recorded during the same period in 2024, according to the latest Labour Force Survey released by the National Institute of Statistics of Rwanda (NISR).

The report released on July 29, highlights a continued improvement in the labour market, with employment indicators surpassing pre-COVID-19 levels.

The 13.4 per cent unemployment rate in Q2 2025 means roughly one in every seven people in the labour force was without work.

The rate also reflects a 3.4 percentage point drop compared to the same period in 2024 and is lower than the May 2019 (pre-pandemic) figure of 15 per cent.

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Female unemployment stood at 15.3 per cent, higher than the 11.8 per cent recorded among men. Youth continued to face a tougher job market, with an unemployment rate of 15.4 per cent, compared to 12.1 per cent among adults. Rates remained comparable across rural (13.3 per cent) and urban (13.7 per cent) areas.

The gender gap in unemployment was 3.5 percentage points, narrowing by 2.2 percentage points from Q2 2024.

The statistics body attributed the progress to sustained economic recovery and the reintegration of previously inactive individuals into the labour force.

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The proportion of the employed population in the service sector rose to 45.6 per cent in May this year, up from 44 per cent in 2024, while the share in the industry sector declined slightly by 0.3 per centage points over the same period.

The employment-to-population ratio rose to 53.8 per cent in, up from 52 per cent in May 2024, representing a 1.8 percentage point increase. The ratio grew for both men and women, rising by 1.3 and 2.2 percentage points, respectively.

Men recorded a higher ratio (61.7 per cent) than women (46.8 per cent), while adults aged 31 and above had a higher ratio (57.4 per cent) compared to youth aged 16-30 (49.1 per cent).

The working-age population (16 years and older) stood at approximately 8.5 million, of whom 4.5 million were employed, 710,000 were unemployed, and 3.2 million were outside the labour force.

The total labour force, comprising both the employed and unemployed, was estimated at 5.2 million.

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The labour force participation rate was 62.2 per cent in May, a slight drop from 62.5 per cent in the same quarter of 2024. Meanwhile, the proportion of the population outside the labour force increased marginally to 37.8 per cent, up from 37.5 per cent.

NISR noted that men continued to participate more actively in the labour force than women. The gender gap stood at 14.7 percentage points in Q2 2025, narrowing by 0.3 percentage points from the previous year.

Underutilisation remains high

Beyond unemployment, the survey also assessed broader labour underutilisation, which includes time-related underemployment and potential labour force.

The labour underutilisation rate stood at 57.1 per cent in May 2025, with a marked gender disparity: 64.3 per cent among women compared to 49.5 per cent for men.

Youth and adults reported similar underutilisation rates, at 57.2 and 57 per cent respectively.

According to John Bosco Kalisa, Vice Chair of the Rwanda Council of Small and Medium-sized Enterprises (SMEs), the drop in unemployment reflects positive economic progress driven by increased productivity.

"Employment is a function of economic productivity. When the economy grows at a healthy pace, unemployment tends to decline. This is a strong indicator of economic recovery,” he said.

Kalisa noted that the sectors contributing most to job creation are those that attract young people, particularly the creative industries, sports, arts and crafts, tourism, and financial services, all of which are largely within the service sector.

He added that the manufacturing sector is also expanding, with growth in areas such as textiles and leather goods.

"Rwanda is regaining control of its domestic market. There’s a growing push to consume Made in Rwanda products,” he said.