Fresh Formal Jobs Creation Falls 10% to 9.06 Mn in 2023: EPFO data

Context: The number of fresh formal jobs created fell by 10 per cent in 2023 compared to the previous year in the latest payroll data, reflecting a slowdown in the pace of formal job creation.

EPFO Data on New Formal Jobs Creation in 2023

• 9.06 million new subscribers joined the Employees Provident Fund (EPF) between January and October. 
  • The figure was 10.1 million in the corresponding period of the previous year. New Young Subscribers declined: The number of new young subscribers from the 18-28 age group declined by 11 per cent to 5.97 million this year from 6.71 million in the corresponding period last year.
• New Women Subscribers declined: The number of new women subscribers declined by 12 per cent to 2.35 million from 2.68 million last year.
• Lowest Unemployment Rate: This deterioration in the quality of employment comes in the wake of the lowest unemployment rate recorded in the country in the past six years.
  • The recently released annual periodic labour force survey (PLFS) showed that the unemployment rate had dropped to a six-year low of 3.2 per cent in July-June 2022-23 from 4.1 per cent in July-June 2021-22.
• Increase in share of agriculture: The PLFS survey has shown that the share of people engaged in agriculture increased sharply to 45.8 per cent in 2022-23 from 45.5 per cent in 2021-22. (To know more about PLFS Survey 2022: Refer, PLFS, here).
• Decrease in manufacturing: The share of people engaged in manufacturing has decreased to 11.4 per cent from 11.6 per cent.

About Formal Jobs

• Formal jobs or employment refers to a type of employment where the terms and conditions of work are regulated and protected by labor laws and employment contracts.
• Key Features of the Formal Jobs Sector, include: 
  • Formal Contracts: A written employment contract that specifies the terms of employment, such as job duties, working hours, pay, benefits, and other terms and conditions, is usually required for formal employment. 
  • Social Security: Social Security benefits, including health insurance, retirement accounts, provident funds, unemployment compensation, and other financial security, are frequently available to formal employees.
  • Labor Rights: Formal employees are entitled to certain legal protections under labour laws, including the ability to engage in collective bargaining, form a union, be shielded from wrongful termination, and have access to legal representation in case of a dispute.
  • Fixed and Timely Payment: Formal employees have a steady income stream from regular wages or salaries, often paid according to a set timetable.

News Source: BS