Home >News >India >New payroll additions in formal workforce shrinks in November

New Delhi: November recorded the fewest fresh additions to payrolls in the last five months, data released on Wednesday showed, reflecting the tough job environment in the wake of the covid-19 pandemic.

At least 640,527 workers joined formal employment for the first time in November, the lowest since July, payroll data released by the Employees’ Provident Fund Organisation (EPFO) showed. The number is 16.8%, or 129,143, less than in October. This is the second month in a row when payroll numbers have declined. November payroll additions in the crucial 18-25 age group fell 17% from the previous month.

In October, while the number of fresh payroll additions was 769,670, in September, this was 1.14 million, the best in terms of fresh additions in the current financial year. While August reported a fresh addition of 745,000 people to the formal workforce, in July this number was 681,150, according to official data.

Compared with a year ago, the numbers appear worse. In November 2019, the number of new EPF subscribers was 987,560, or 347,000 more than the November 2020 numbers.

The November numbers are also crucial as they come against the backdrop of an EPF subsidy scheme with a cut-off date of 1 October to spur formal jobs growth at least at the lower salary levels.

The fresh payroll additions are provisional and the data changes over time.

The EPFO said while the fresh payroll additions were 640,527, net payroll additions were more than one million. However, even this number is less than corresponding figures in September and October. Net payroll additions are reached by calculating fresh additions and adding to this the number of people who left their jobs and later came back to the EPFO fold. The net payroll additions fluctuate more than fresh payroll additions, which are preferred by experts.

The retirement fund body said the comparison of payroll figures among states “shows that states of Maharashtra, Haryana, Gujarat, Tamil Nadu, and Karnataka continue to remain at the forefront of the employment recovery cycle adding approximately 53% of the total net payroll during the current financial year 2020-21 (from April to November, 2020) across all the age groups".

“Category-wise analysis of industry indicates that the expert services category (which primarily includes manpower agencies, private security agencies and small contractors) continues to be the best performer," the EPFO said.

Other categories such as the building and construction industry, engineers, including engineering contractors, electrical, mechanical or general engineering products, indicates that recovery has started picking up.

“Out of a total of 6.41 lakh new subscribers who joined the EPF scheme in the month of November 2020, a total of 1.43 lakh were female workforce," the EPFO said.

While the number of new EPF subscribers below the age of 18 years were 6,744, at least 362,784 are in the 18-25 age group, 168,329 are in the 26-35 age group, and the rest are above 35 years old.

The low payroll addition indicates that the job market is taking longer to recover in several sectors. Expert service sector comprising manpower agencies, private security agencies and small contractors saw a net addition of 117,379 people in the 22-25 age group, while the other top nine sectors including trading, financial establishments, engineering and manufacturing added less than 100,000 jobs for the same age cohort.

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