After a marginal sequential dip in May, new subscribers’ addition under the social security schemes run by the Employees’ Provident Fund Organisation (EPFO) rose in June to 1.054 million, up 4.6% from the previous month. In May, 1.007 million new subscribers joined EPFO, slightly lower than 1.009 million joined in April, the latest payroll data showed.
With this, new subscribers’ addition crossed the one million-mark in each of the first three months of this fiscal. This suggests a nascent recovery in the labour market, as the average monthly new addition was 0.9 million in FY22, 0.71 million in FY21 and 0.92 million in FY20.
Of course, fresh addition doesn’t always mean new jobs (in many cases, it could just be a shift of jobs from the informal to the formal sector). Nevertheless, the rise in new subscribers’ addition, particularly after the closure of the registration window under the job-incentivising provident fund subsidy scheme, Atmanirbhar Rojgar Protsahan Yojana (ABRY), in March this year, signals growing employment prospects, at least in the formal sector, as economic activities pick up.
Meanwhile, at 1.83 million, the net enrolment under the EPFO was the highest in June among the first three months of the fiscal. It stood at 1.47 million in May and 1.42 million in April this year.
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Labour economist KR Shyam Sundar said, “The urban labour market is showing a sense of stability, as industrial growth has also been picking up. This bodes well for the economy as this is also corroborated by the continued lower offtake under MGNREGA in the rural areas. Overall, one may say the labour market is on the path to recovery.”
In a statement issued Saturday, the ministry of labour and employment said, “The new enrolment during the month (June) is higher than the monthly average recorded during the last fiscal. New member joining has shown a growing trend since April, 2022.”
According to the Centre for Monitoring of Indian Economy (CMIE), country’s overall unemployment rate in June was 7.8%, up from 7.12% in May, but slightly lower than 7.83% in April.
To boost employment generation in the formal sector in the aftermath of the Covid outbreak, the government had in 2021 committed to credit, for a period of two years, shares of both the employees and employers (12% of wages each) to the PF contribution, subject to conditions.
Also, establishments taking new employees on or after October 2020 and up to March 2022 or employing again those who lost their jobs between March 2020 to September 2020 were eligible to avail of the scheme. While the registration window for the scheme ended on March 31, those registered will continue to receive the benefits for two years from the date of registration under the scheme.
Those belonging to the 22-25 years age bracket registered the highest number of net enrolments with 0.47 million additions in June. Establishments covered in Maharashtra, Karnataka, Tamil Nadu, Haryana, Gujarat and Delhi continue to lead by adding 68.66% of total net payroll addition across all age groups.
Gender-wise analysis indicates that enrolment of net female members has increased to 0.4 million in June from 0.34 million in May, registering an increase of 18.37%.
