The demographic structure of the population has an important role in determining the labour force participation in economic activity and hence the consumption behaviour of a household. Demographic dependency ratio is widely used in literatures to understand the demographic structure. However, this measure has a certain limitation as it does not measure the impact for those who fall under working age but actually are out of labour force. Therefore, in this paper, the prime objective is to calculate the employment-based economic dependency ratios along with region-wise sectoral analysis of the employment structure of India. Further, decomposition of the dependency ratio has been done to measures the contribution of various factors on the dependency ratios. This paper has proposed sectoral dependency ratio based on the employed workforce among the sectors and its trends among the state regions. An empirical estimates has been performed to test the impact of these dependency ratios on household consumption and expenditure behaviour. Periodic Labour force survey data and National Industrial classification-2008 for sectoral classification have been used for the overall analysis. The analysis reveals that most of the female workforce is out of labour force due to engagement into education or domestic duties in the household. The unemployment rate among young labour force is highest, particularly among southern states. There is a positive correlation between employment and age-based dependency ratio meaning that there is a need for such public policy towards some balancing mechanisms. There is a significant variation among the state groups for all dependency measures.