Thodupuzha boasts a robust, wealthy local economy driven by cash crop agriculture, wholesale and retail commerce, and a heavy influx of NRI remittances. Because Idukki district has very few large towns, Thodupuzha acts as the central market and shopping destination for the surrounding rural populations.
The cost of living in Thodupuzha is moderate compared to larger metropolitan areas like Kochi, though real estate prices are exceptionally high due to limited flat land and strong purchasing power from expatriate investments. While heavy industry is largely absent, the town has a strong entrepreneurial ecosystem focused on agriculture-allied businesses, retail, healthcare, and education.