by Elton Gomes
Citing payroll data of the EPFO (Employees’ Provident Fund Organisation), the Central Statistics Office (CSO) has said that up to 41.26 lakh new jobs have been created in the eight months till April 2018 with 6.85 lakh jobs being created in April alone.
Covering the period from September 2017 to February 2018, the CSO had presented the first release of employment-based statistics in the formal sector in April 2018. In a similar data release, including the data for the month of April, the EPFO data suggests that during September 2017 to April 2018, as many as 41,26,138 payrolls were created. In April 2018 alone, a total of 6,85,841 new payrolls were registered by the EPFO. As per the data, the EPFOs numbers for April have been the highest since the last eight months, thereby leading to creation of more jobs than the previous seven months.
In the month of April, a maximum of 1,78,221 new payrolls were recorded in the age bracket of 18 to 21 years, while 1,80,892 payrolls were recorded for the age bracket of 22 to 25 years.
Although EPFO data suggests the introduction of new payrolls, which in turn translate to new jobs, the data might not be fully useful. This is because the data does not consider several aspects affecting employees and their jobs.
Decoding EPFO data
A report in Swarajya Mag argues that the data might be problematic as employees tend to have multiple accounts due to job changes. The article further claims that the data might be overcounting the growth in jobs as informal jobs get formalised – this simply means a transition from non-reported employment to an official one. Due to the goods and services tax (GST), some small companies may feel the urge to formally register employees on their payrolls. It would make sense for small companies to show employees on their payrolls as this could amount to costs to be deducted from sales revenue.
The report mentions that although the data was not completely unreliable, it needs to be tweaked often. As the purview of formal jobs expands, the data should look to include all new jobs that are included in the formal sector. More importantly, the data would benefit significantly if information is gathered on where new PF subscribers are coming from are they being newly registered, or simply continued from company to company.
In an interview with the Indian Express, Indias chief statistician Pronab Sen was of the opinion that a better way to assess job data would be from the employers side in order to see whether addition of jobs is from existing employers or newly registered employers. Sen said that the GST might have prompted many companies to register their employees, which in turn get added to EPFO numbers. And this might not be equivalent to creating a new job.
Elton Gomes is a staff writer at Qrius