The financial year that went by was not quite favourable in terms of formal job creation. The latest numbers from the Employee Provident Fund Organisation indicate that there was just a 5 per cent growth in the net number of people who enrolled with the EPFO in FY24.

In FY24, 1.44 crore people were added to the EPFO payroll., compared to 1.38 crore in FY23. Although the FY24 number is slightly high, the growth has been much more pronounced in the last few fiscals, since the pandemic. It was 58 per cent in FY22 and 13 per cent in FY23.

In FY24, most jobs were added in January - 16.02 lakh. In the fiscal, 48,262 new establishments started complying under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, ensuring social security coverage to their employees.

The EPFO releases its monthly payroll addition numbers with a two-month delay. In monthly payroll data, the count of members joining EPFO for the first time through a validated Universal Account Number (UAN), existing members exiting from coverage of EPFO, and those who exited but re-joined as members are taken to arrive at the net payroll numbers.

The number of new additions to the payroll was low in FY24 (1.07 crore), compared to FY23 (1.14 crore). However, fewer people exited the workforce in FY24.

North’s growth rate

Among the more populous states in the country, Uttar Pradesh and Uttarakhand saw the highest growth in the number of formal jobs created in FY24. The growth was 20.3 per cent in UP, while Uttarakhand saw a 19.99 per cent growth. This could be owing to the increasing formalisation of the economy in these states.

The others in the list of top five States with the highest growth in formal job creation include Rajasthan, Punjab and Himachal Pradesh, in that order. Of them, Rajasthan and Himachal Pradesh were infamous for their very high unemployment rate. However, the latest Periodic Labour Force Survey quarterly report shows the unemployment rate dropping in these states. While Rajasthan added 5.32 lakh new formal jobs, Punjab added 1.73 lakh, and Himachal Pradesh added 1.03 lakh, recording a growth of more than 15 per cent.

At the same time, highly industrialised states like Maharashtra, Tamil Nadu, Karnataka, and Gujarat added the most formal jobs in FY24. Among industries, expert services added the most jobs.