Narendra Modi Government is facing criticism over lack of job growth during their tenure. With initiatives such as demonetisation and GST which have impacted the small businesses, it is widely believed that all this has severely impacted India’s job growth story.
What is the issue?
- Till earlier, the government was disarmed with little data to disprove their opponents with facts.
- The last NSSO Survey (conducted in 2015-16) showed that unemployment levels were at a 4-year peak of 5 percent with unemployment amongst women at almost 8.7 percent as compared to 4 percent employment rate prevalent amongst the men.
- However, the recently released payroll data has armed the Central Government to disprove their opponents with facts.
What is ‘payroll data’?
NITI Aayog was tasked to tap the data collected by the Employees’ Provident Fund Organisation (EPFO), Pension Fund Regulatory and Development Authority (PFRDA) and Employees’ State Insurance Corporation (ESIC) to put forward a payroll report of the formal sector employment to the Government. The recently released report will be a monthly publication now to help track jobs added in the formal sector.
What does the report say?
- According to the data released by the EPFO, almost 31.1 lakh new jobs were added during the September 2017 to February 2018 period.
- PFRDA’s data shows that 4.2 lakh new payrolls were generated in the same period in Tier-I account. All this largely reflects that the additions to both Central and State Government jobs.
- Similarly, the ESIC data is complementing the above-mentioned reports too.
- A regular track on job growth would help the government to align their policies in line with its objective to boost employment creation.
- A positive picture has been presented by the EPFO and PFRDA which will boost confidence amongst the youth and help to expand the formal sector outreach.
- As the current figures do not account for professional sector job creation, the NITI Aayog could also tap data from the ICAI, Bar Council of India, Medical Council of India and other such professional bodies to account for professional sector contribution.
- Periodic surveys by appropriate authorities can also help to tap the informal sector (agriculture and micro enterprises) employment figures so as to help the government to create appropriate policies for them and align them into the mainstream economy.
- NSSO is planning to bring out annual as well as quarterly employment surveys to present a holistic view of employment in the future.
Monetary policies formulated by the RBI uses unemployment figures as one of the key data points while formulating such policies. A comprehensive and reliable data collection could help them to effectively transmit the monetary policy benefits to the ground.
A word of caution
The government should take caution to filter down the numbers shown by both EPFO and PFRDA so as to prevent duplication and inactive accounts.
It must be noted that any business employing more than 20 persons needs to register itself with EPFO, so it must be ensured that the data showing an addition of new jobs has not considered the already existed informal sector jobs by moving it to the formal sector when the concerned business has expanded.
Source – The Hindu Business Line
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