In the month of July, new job creation rose to an 11-month high of 9.51 lakh, taking the total number to 61.81 lakh since September 2017, as per EPFO’s payroll data. Amid concerns over jobless growth and lack of comprehensive data on jobs, the government started releasing data on job creations in the formal sector since September 2017. Any company employing more than 20 people gets covered by EPFO.
Here are three things that you need to know about EPFO payroll data
1. Provisional numbers: The EFPO data is provisional in nature and can be revised upwards or downwards in coming months. Speaking with FE Online recently, one of the architects behind EPFO payroll data collection, Soumya Kanti Ghosh said that it is a continuous process and needs some time to get fully streamlined.
However, he ruled out any duplication of data due to its linking with Aadhaar. 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”.
2. Upward/Downward revision: The EPFO data on number of registrations was revised downwards by as much as 12.4% for September-May period to 39.2 lakh from the earlier estimates. But the EPFO revised upwards the number of new enrolments from September 2017 to June 2018 to 52.30 lakh from 47.13 lakh estimated earlier.
3. New jobs, or just fomalisation? It is too early to say that EPFO payroll data is reflecting jobs creations. As highlighted by the Financial Express earlier, as an example, if there’s a company with 19 employees and creates just 1 job position to become a 20-employee company, the EPFO will register all 20 employees as new but the actual job creation will only be one. However, along with the Goods and Services Tax (GST), the EPFO registration points towards formalisation of jobs.
The government, in June this year, formed a technical committee under former chief statistician TCA Anant to calculate job creation taking into a larger sample. Meanwhile, in absence of comprehensive jobs data, the most preferred alternative, CMIE data, based on Consumer Pyramids Household Survey, shows a contrary picture.
As per latest CMIE data on unemployment, the employment scenario is deteriorating. “The number of total persons employed in July was 1.4 per cent lower than it was in July 2017. In August it was similarly lower by 1.2 per cent. The count of employed persons has been declining since November 2017,” CMIE’s Mahesh Vyas said in his analysis of jobs data.