Formal employment on the rise in India
Lower addition of 0.32mn/month in H1 was almost entirely offset by a strong growth in second half (0.97mn/month); The net new subscribers to EPFO stood at 7.3mn (or 1mn per month) in Apr-Oct, with an average monthly net increase of 1.3mn as against 0.7m/month in the pre-Covid period
image for illustrative purpose
Mumbai: The data from the Employee Provident Fund Organization (EPFO) has revealed that on an aggregate basis, 7.7million (0.64mn per month) net new subscribers were added to EPFO in FY21, only marginally lower than 7.9mn (0.65mn/month) net new subscribers in FY20. The headline numbers suggested that India's formal employment in the first seven months of FY22 continued to grow unabated, according to the EcoScope report of Motilal Oswal Financial Services Limited (MOFSL). As the Covid-19 pandemic was at its worst during the first half of the current fiscal, net new subscribers fell to just 1.9mn (0.32mn/month) as compared to 3.3mn (0.55mn/month) in the year-ago period. The net new subscribers to EPFO stood at 7.3mn (or 1mn per month) in April-October, with an average monthly net increase of 1.3mn during this period. The lower addition in first half (H1) (at 0.32mn/month) was almost entirely offset by a strong growth in the second half (0.97mn/month). It implies that the formal employment in India has increased at more than 1m/month during the past 14 months as compared to 0.7m/month in the pre-Covid period.
However, one serious issue with the EPFO data is the massive revisions. The first series of EPFO payroll data was published in May 2018, when net new subscriber data was provided for September 2017 to March 2018.
