Indiana labor force outpaces nation as unemployment rate drops to 3.5%

INDIANA — New data released today by the Indiana Department of Workforce Development (DWD) paints a picture of a resilient Hoosier economy. As of December 2025, Indiana’s unemployment rate fell to 3.5%, significantly outperforming the national rate of 4.4%.

While the national unemployment rate rose during the final quarter of the year, Indiana maintained a high level of engagement in its workforce. The state’s labor force participation rate reached 63.6%, more than a full percentage point higher than the national average of 62.4%.

Currently, Indiana’s total labor force stands at 3,495,276 individuals. This figure includes both those currently employed and Hoosiers actively seeking work.

Those outside this metric typically include:

• Full-time students and retirees.
• Individuals with disabilities or long-term illnesses.
• Adults managing primary childcare or family needs.

Despite the low unemployment rate, the private sector saw a modest cooling toward the end of the year. Total private employment was recorded at 2,849,500 in December, a decrease of 5,800 jobs since September. However, specific sectors continued to show growth even through the winter months.

December Industry Gainers:

• Financial Activities: +800 jobs
• All Other Services: +400 jobs

Opportunity for Job Seekers

The DWD report highlights a substantial surplus of opportunity for those looking to re-enter the workforce. As of December 31, 2025, there were 83,797 open job postings across the state. In contrast, continued unemployment insurance claims remained relatively low, with 25,414 filings reported for the week ending January 3, 2026.

“Indiana continues to demonstrate economic stability with a participation rate that consistently beats the national trend,” the department noted.

Hoosiers looking for new career paths, specialized training, or local job listings are encouraged to utilize state resources at in.gov/dwd/job-seekers.