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Employees’ Provident Fund Organisation (EPFO) data recently released by ministry of statistics and programme implementation represent a mixed bag for the organised sector employees in recent years. The number of EPFO members who stopped subscribing was higher than the new subscribers to the fund the the first such occasion in recent years in FY21, revealed the data. The difference between the new members and members stopping subscription between April 2020 and March 2021 was 12,34,139.
While the new members were people enrolling for the first time, and therefore, largely signifying new recruits, the members who stopped subscribing pertained to job losses or retiring.
EPF is applicable in organisations with 20 or more workers. It pertains to the organised sector of the economy.
First occasion
The Covid-hit FY21 was the first occasion in recent years when the number of EPF members dropping out was higher than the new members added to the EPF Organisation, signifying a contraction in new employment.
However, the number of EPF members who exited but rejoined and resubscribed during the period stood at (89.42 lakh).
In all the time windows for which data was given out by the government, new additions to the EPFO exceeded those who stopped subscribing.
Old versus new
For example, between September 2017 and March 2018, the new additions was more than those who stopped subscribing by 729,615 – 84,57,404 new members against 77,27,789 dropping out.
In the year 2018-19, the difference was 1,647,408 – 139,44,349 fresh members against 122,96,941 members who stopped subscribing.
In 2019-20, the number of new members surpassed the members who stopped subscribing by 43,769, indicating a drastic slowdown in recruitments. During this year, the number of fresh members stood at 110,40683 while the members stopping subscribing was at 109,96,914.
In 2020-21, the slowdown turned into a net negative number.
However, in April 2021, the month scarred by the savage second run of the infection, the number of new EPFO members exceeded that of the old members who stopped subscribing. While the new members stood at 689,403 the members dropping out was at 266,128.
Moreover, as many as 852,454 members who had exited rejoined during this period and began subscribing again.
Rejoining up too
Significantly, over the past three years, there seems to be a consistent rise in the number of EPFO members who rejoined and began subscribing again.
While the number was 8,23,325 in the seven-month period between September 2017 and March 2018, it rose to 44,64,815 in 2018-19.
In the next year 2019-20, the members rejoining went up by 75% and was recorded at 78,14,625.
In Covid-hit 2020-21, the number of such EPFO members stood at 89,42,514 – a rise by 14.43% over the previous year.
April 2021 was particularly good for old members who had lost their jobs, since more people who had lost their jobs got back work than new recruits.
Unorganised sector
The unorganised sector suffered most during the pandemic due to the lockdowns.
As many as 2.53 crore jobs were lost between February and May this year, Centre for Monitoring Indian Economy estimated.