Volume of fresh formal jobs in India dips to a three-month low in February

By Sneha Sengupta • Published on April 20, 2024 at 9:27 PM IST

2 min read

The most recent payroll data provided by the Employee Provident Fund Organization (EPFO) on Saturday indicated that the formal labor market in the nation saw a downturn in February, with fewer new employment being created.

The Employees’ Provident Fund (EPF) saw a decrease in new monthly subscribers in February, falling short of 3.7% to 777,717 from 807,865 in January. This is important since social security benefits and labor rules are exclusive to the formal workforce. In contrast, as of February 2023, 764,106 subscribers had joined the EPF.

The percentage of women among all new members rose somewhat to 26.4% (205,386) from 25.3% (204,569) the month before. In the meantime, net payroll increases decreased from 1.60 million in January to 1.54 million in February, a 3.4% decrease. However, net monthly payroll figures are tentative and frequently drastically altered the next month.

The Consumer Pyramids Household Survey by CMIE revealed a decline in the job market in February, with the jobless rate rising to 8% from 6.8% in January.

“The payroll data highlights that about 1.8 million members exited and subsequently rejoined EPFO. These members switched their jobs and rejoined the establishments covered under the EPFO and opted to transfer their accumulations instead of applying for final settlement, thus safeguarding their long-term financial well-being and extending their social security protection,” the labour ministry mentioned in an official statement.

While the urban unemployment rate decreased from 8.9 percent to 8.5 percent over the same period, the rural jobless rate rose substantially from 5.8 percent in January to 7.8 percent in February. From 40.6% the month before to 41.4% in February, the labor force participation rate (LFPR) increased.

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