This is owing in part to the pandemic, but a plateauing of the EPFO subscription base has been evident in recent months after the government's efforts at formalisation of the work force caused a jump in the subscription base of the retirement fund body for a certain period.
Despite the provident fund subsidy scheme aimed at incentivising new recruitment, both net and new additions to the subscriber base of the Employees Provident Fund Organisation (EPFO) fell in May.
This is owing in part to the pandemic, but a plateauing of the EPFO subscription base has been evident in recent months after the government’s efforts at formalisation of the work force caused a jump in the subscription base of the retirement fund body for a certain period.
While there was a net addition of 11,00,145 to the EPFO subscribers’ base in April, the number declined to 9,19,772 in May, registering a 16.4% decrease. Similarly, only 5,72,634 new subscribers joined the scheme in May, down 22.8% from 7,41,270 in April, EPFO’s latest payroll data showed.
The EPFO subscription numbers are often subject to big revisions; a clearer picture of a period emerges after such changes. EPFO arrives at the net number deducting the total of the subscribers’ who exited from the sum of new subscribers and those who left earlier but rejoined during the period. In May, the number of subscribers who exited and those who rejoined both fell compared with April, 2021.
In the entire 2020-21 fiscal, the monthly average of net addition to the EPFO’s subscribers’ base was 6,42,364 and the new addition was 7,12,408.
The provident fund subsidy scheme – Atmanirbhar Bharat Rojgar Yojana (ABRY)— was first announced on November 12, 2020, as part of the Atmanirbhar Bharat Package 3.0. Under the scheme, the Centre provides provident fund subsidy in respect of new employees engaged on or after October 1, 2020. The window has recently been extended by nine months till March 30, 2022.
Under ABRY, the Centre is crediting for a period of two years both the employees’ and employers share’ (24% of wages) or only the employees’ share (12% of wages), depending on the strength of EPFO registered establishments.
Since April 2018, the EPFO has been releasing payroll data covering the period September 2017 onwards.
According to the payroll data, the age-group of 22-25 years has registered highest number of net enrolments with around 2.39 lakh additions in May, followed by the 29-35 age group with around 1.90 lakh net enrollments. Gender-wise analysis indicates that the share of female’s enrolment is approximately 21.77% of total net subscribers addition during the month.
State-wise comparison of payroll shows that establishments registered with Maharashtra, Haryana, Gujarat, Tamil Nadu and Karnataka are still in the forefront by adding approximately 5.45 lakh subscribers during the month, which is around 59.29% of total net payroll addition across all age groups.
Industry-wise payroll data indicates that ‘expert services’ category (consisting of manpower agencies, private security agencies and small contractors, etc) constitutes 46.77% of total subscribers addition during the month.