Does EPFO data mean job creation? Surjit Bhalla, Arvind Virmani, Soumya Kanti Ghosh debate on Twitter

By: | Updated: October 23, 2018 4:34 PM

Job creation or job formalisation, what does the Employees' Provident Fund Organisation (EPFO) data mean? The question has received contradictory answers.

The EPFO data was revised downwards for the month of September 2017 by nearly 11.9% and March 2018 by 9.2% as compared with previous month's estimates.The EPFO data was revised downwards for the month of September 2017 by nearly 11.9% and March 2018 by 9.2% as compared with previous month’s estimates.

Job creation or job formalisation, what does the Employees’ Provident Fund Organisation (EPFO) data mean? The question has received contradictory answers. Even as Prime Minister Narendra Modi quoted the EPFO and National Pension Scheme (NPS) data in the Parliament to claim job creation to the tune of 1 crore, the newly-appointed chief statistician Pravin Srivastava contradicted the popular opinion by saying that the data never “talked about job creation”.

Meanwhile, the latest set of data released on Saturday showed that the EPFO subscription slowed down in August. Moreover, EPFO also revised previous months’ data significantly revised, both upwards and downwards. The EFPO data was revised downwards for two months, while upwards for rest of the month between September 2017 and July 2018, showing its provisional nature.

Data released in September vs data released in October

The EPFO data was revised downwards for the month of September 2017 by nearly 11.9% and March 2018 by 9.2% as compared with previous month’s estimates. October 2017 witnessed highest upward revision of 15.7%.

Speaking with FE Online earlier, Soumya Kanti Ghosh — one of the architects behind EPFO payroll data collection — had said that the process is at an early stage and will require some more time to get fully streamlined. He said that there may have been an overestimation of the data due to the delayed removal of retirees from the list and other kinds of backlogs.

Chief Statistician Pravin Srivastava, in an interview with The Indian Express earlier this week, reiterated what was always mentioned with the EPFO data release. According to the EPFO, the data gives “different perspectives” on the levels of employment in the formal sector and does not measure “employment at a holistic level”.

On similar lines, Srivastava said, “I don’t think we ever talked about job creation. It was trying to say that these people have entered the formal market. They were not unemployed, they need not have been unemployed earlier.”

As EPFO payroll data series completed a 12-month period, top economists took to Twitter to discuss various aspects — and most importantly, does it mean job creation?

In April this year, the country for the first time introduced monthly payroll reporting with the aim of facilitating analysis of new and continuing employment. The EPFO takes into account companies with more than 20 individuals on the payroll.

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