378829 SIP myths you must know!

Net new enrolments declined by 1.9% in FY21 under Employees Provident Fund Organisation (EPFO) to 77,08,375 compared to 78,58,394 in FY20. This decline is due to job loss and lack of new job offers that has characterised the economy over the past one year.

Net enrolments under EPFO in March 2021 stood at 11.21 lakh down from 11.28 lakh in February, 2021 reflecting the impact on jobs because of partial lockdowns.

“Data, however, is provisional as updation of employee’s records is a continuous process and gets updated in subsequent months,” EPFO mentioned in a press release.

In the past one year, EPFO witnessed growth in September, 2020 as the economy was trying to come out the grip of the first wave of the infection. That month, approximately 12.16 lakh new subscribers joined EPFO.

Lockdown impact

The retirement fund body saw a dip in net new enrolments both in April and May 2020 when there was a nationwide lockdown.

The net new enrolments under EPFO fell by 2,84,576 in April and by 2,89,489 in May as there were more job losses in these months.

Of the net new additions in March, (11.21 lakh) the highest addition was in the 22-25-year age bracket at 3,14,489. The new enrolments in the 18-22-year age group was 2,28,937 and in the 29-35-year age group there were 2,19,350 additions.

Job loss

Recent data published by Centre for Monitoring Indian Economy shows that in April national unemployment rate went up to 7.97% from 6.5% in March, 2021.

This rate was at 6.5% in January and 6.9% in February this year.

Besides, 33.85 million people were looking for new jobs in April compared to 27.7 million in March and 29.5 million in February.

The number of people with a job in the country declined by 1 crore over a period of only three months. In January the number of total employed people was 40.08 crore, which came down to 39.078 crore in April, 2021.

Closer look

Quarterly analysis of payroll for FY21 indicates that net subscriber addition improved consistently from the second quarter after taking a hit in the first quarter due to the crisis in the wake of the pandemic.

According to the statement, the maximum improvement of 33.64 lakh net subscribers was observed during the fourth quarter (January-March), a growth of 37.44% compared to the third quarter (October-December).

The number of new subscribers is based on Universal Account Numbers or UAN generated in the system.

EPFO covers establishments with 20 or more employees.