The ratio of first jobs/new payroll to total payroll in the first quarter of FY22 indicates that one out of two jobs was a new addition, according to State Bank of India’s economic research report Ecowrap.

The report emphasised that this indicates that labour market disruptions were much lower during the second wave of the Covid-19 pandemic.

This addition in jobs comes in the backdrop of the GDP growth print coming in at 20.3 per cent in the April-June quarter against a contraction of 24.4 per cent in the year-ago period. The latest data released by the Employees’ Provident Fund Organisation (EPFO) indicates that net new EPF subscribers during April-June 2021 were 28.9 lakh, which was quite encouraging given that this period was marred by the devastating second wave, it added.

Soumya Kanti Ghosh, Group Chief Economic Adviser, SBI, said: “As per our calculation, the total payroll was 28.9 lakhs for Q1FY22, of which 14.5 lakhs were first job /new payroll.

“If the payrolls increase at this rate then the new payroll may cross the 50-lakh mark in FY22 as against 44 lakhs in FY21.”

Ghosh expects the labour market activity to remain robust this fiscal as companies will continue with hiring plans.

NPS & EPFO data

Ecowrap said the National Pension System (NPS) data indicates an addition of 1.85 lakh new subscribers in April-June 2021, of which State Government payrolls added 1.27 lakh, followed by non-government (37,587) and Central government (20,353).

The second job number (that is, exiting members re-joining and re-subscribing) was also encouraging at 11.8 lakh in April-June 2021 (in FY21, it was 41.2 lakh). The formalisation was 26 lakh in Q1FY22.

Cumulatively, total new payroll/first job generation of EPFO and NPS was almost 16.3 lakh in April-June 2021.