Ther are 220 million employees in the economy, out of which 75 million workers enjoying social security benefits
Formal jobs are much more than what the current official estimates, thereleased on Monday said.
The Survey, analysing the data from goods and services tax (GST) and newly available digitised government data, said there were a total of 220 million (22 crore) employees in the economy, out of which 75 million (7.5 crore) workers enjoying social security benefits at present.
The Survey defined formal employment in two parts — First, those receiving social security benefits from Employees’ State Insurance Corporation and Employees’ Provident Fund Organisation. Second, those receiving it from firms under the GST regime.
“From a social security perspective, formal employment amounts to 60 million (6 crore), to which we must add an estimated 15 million (1.5 crore) of government workers (excluding defence), for a total of 75 million (7.5 crore),” the survey said.
From a tax perspective, formal employment is 112 million (11.2 crore) and government employment yields a total count of 127 million (12.7 crore), it noted. “Notwithstanding the caveats regarding the specific numbers, the broad conclusion is likely to be robust: formal payrolls may be considerably greater than currently believed,” the survey said.
The Survey added that when formality was defined in terms of social security provisions like EPFO or ESIC, the formal sector payroll was found to be about 31 per cent of the non-agricultural workforce. When formality was defined in terms of being part of the GST net, such formal sector payroll share stood at 53 per cent, it said.
“Even so, it is clear that providing India’s young and burgeoning labour force with good, high-productivity jobs will remain a pressing medium-term challenge. An effective response will encompass multiple levers and strategies, and above all, creating a climate for rapid economic growth on the strength of the only two truly sustainable engines — private investment and exports,” according to the Survey.