The total employment reported by micro, small and medium enterprises (MSMEs) registered with the MSME Ministry has crossed the 20-crore mark, according to data from the Udyam registration portal. As of July 4, 4.68 crore Udyam-registered MSMEs reported 20.19 crore jobs including 2.32 crore jobs by GST-exempted informal micro enterprises, up by 66 per cent from 12.1 crore jobs in July last year. Out of the total jobs reported so far, 4.54 crore were women employees.
In contrast, the annual reports by the MSME Ministry continue to cite the National Sample Survey (NSS) 73rd round conducted during the period 2015-16 for total MSME jobs in the country.
According to the ministry’s 2022-23 report citing the survey, “the MSME sector has been creating 11.10 crore jobs, including 3.6 crore in manufacturing, 7,000 in non-captive electricity generation and transmission, 3.8 crore in trade and 3.6 crore in other services in the rural and the urban areas across the country.
Highlighting the jump in the MSME jobs reported on the Udyam portal, the Finance Ministry in its monthly economic report earlier this year noted the number of people employed has increased 5.3 times since the launch of the Udyam portal by the government back in July 2020, according to the Department of Economic Affairs (DEA) under the Finance Ministry in its latest monthly economic report.
The DEA highlighted that the revision in the definition of MSMEs has provided ease in doing business and promoted investment and employment. However, the pace of job creation by Indian small businesses is expected to slow this year.
According to a survey by professional accounting body CPA Australia in May this year comprising 505 small businesses from India and overall 4,222 small business respondents in 11 markets, 67 per cent of Indian small business respondents plan to recruit new staff this year, lower from around 86 per cent last year.
The survey noted increasing costs, competition, and cash flow-related challenges among the major barriers to India’s small businesses last year. Among various costs, staff costs and materials were the most detrimental to small businesses in 2023.