Local restrictions due to second Covid wave across India hit formal job creation in May


Local restrictions across India impacted formal job creation in May with net new additions under the Employees Provident Fund Organisation registering a dip in May compared to April. Even newly registered employees under the Employees State Insurance Corporation and enrollments under the National Pension Scheme registered a fall in May reflecting slowdown in formal sector hiring.

The payroll data by the ministry of statistics and programme implementation, released on Friday, shows net new additions under the EPFO stood at 0.9 million in May compared to 1.1 million in April, a decline of 16.3%. Even companies remitting ECR in the month declined and stood at 3038 compared to 4083 in April.

New enrollments under ESIC fell more sharply by 17.9% to 0.8 million as against 1.07 million in April while the new enrollments under NPS were low by 9.45% to 50566 compared with 55844 in April.

The report further said that since the number of subscribers is from various sources, there are elements of overlap and the estimates are not additive. The report gives different perspectives on the levels of employment in the formal sector and does not measure employment at a holistic level, it further said. The data, however, is subject to change and date is continuously updated

As per the report, 6,312 central government employees joined NPS in May while 31,784 state government employees enrolled for the scheme and 12,470 corporate sector employees joined in April.

Of the 0.87 million subscribers added under ESIC, 0.70 million were men and 0.16 were women workers. Further, out of the 0.9 million net subscribers added during the month under EPFO, around 0.57 million new members have come into the social security coverage of EPFO for the first time while 0.61 lakh net subscribers exited and then rejoined EPFO by changing their jobs while 0.26 million ceased to be EPFO subscribers in the month.

Mospi has been bringing out the employment related statistics in the formal sector covering the period September 2017 onwards, using information on the number of subscribers who have subscribed under three major schemes, namely the Employees’ Provident Fund (EPF) Scheme, the Employees’ State Insurance (ESI) Scheme and the National Pension Scheme (NPS).

While EPF is applicable to establishments having more than 20 workers earning wages up to Rs 15,000 a month, ESIC applies to firms and establishments with 10 or more employees with wages up to Rs 21,000 a month.

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