Home / News / India /  New payroll additions in April at 10-month low as job creation slows

At least 689,403 new people joined the formal workforce in April, the lowest in 10 months, the Employees’ Provident Fund Organisation’s (EPFO’s) provisional payroll data showed on Sunday.

The slowdown in the new payroll creation data shows the impact of the second wave of the pandemic. In March, 716,223 new workers had joined the workforce. The number of new EPFO subscribers in February was at 807,482, while in January 883,392 people had joined the formal workforce, the payroll data showed.

The last time new payroll additions were lower than April 2021, was in June 2020 (577,832) when the country was in the grips of the first wave of the pandemic.

The fall in new enrolments in April were primarily due to muted job opportunities for the 18-25 age group. While the 26-28 and 29-34 age groups witnessed a marginal dip in new jobs growth, those older than 35 years witnessed nominal growth in April, compared with March. While 398,516 new workers in the 18-25 age group joined the workforce in March, in April the number was 370,895.

Experts said fresh payroll additions in May could decline further, as daily covid infections had slowed economic activity for most of April and May in India, with state-wide lockdowns. However, net payroll additions in April was around 1.27 million, EPFO said. Net payroll additions are arrived at by adding the new subscribers to the number of workers who were part of the EPFO system and were now back. But labour economists and experts consider new payroll additions as more reliable than net payroll additions as the latter tends to fluctuate more.

State-wise enrolment numbers show that Maharashtra, Haryana, Gujarat, Tamil Nadu and Karnataka were the highest job creators, while north eastern states saw above average growth in terms of net subscribers additions, compared to previous months, EPFO said in a separate statement without divulging further details.

“Gender-wise analysis indicates that the share of female’s enrolment is approximately 22% of total net subscribers’ addition during the month," it added. “Industry-wise payroll data indicates that ‘expert services’ category (consisting of manpower agencies, private security agencies and small contractors) constitutes 45% of total subscribers’ addition in the month. In addition, industries involved in making plastic products, beedi, schools, banks and establishments related to iron and steel sectors have registered above-average growth in terms of net addition of subscribers in April, 2021, as compared to March."

“The jobs environment especially for the formal sector will look up once the second wave subsides and economic activity, industry production and market demand revives," said Arup Mitra, professor of economics, Delhi University.

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