Are wages growing at faster rate than job creation? ESIC data unclear

Are wages growing at faster rate than job creation? ESIC data unclear

The payroll count provided by the Employees’ State Insurance Corporation (ESIC) last week failed to show any conclusive trend on job creation in the formal sector due to duplication band and various other discrepancies in the dataset.

For the first time ever, last Wednesday ESIC, along with Employees’ Provident Fund Organisation (EPFO) and the Pension Fund Regulatory and Development Authority (PFRDA), released data on provisional estimates of payroll based on its subscriptions.

While EPFO was able to paint a clearer picture of the payroll stock with Aadhaar being the unique identifier for its subscribers, the ESIC data carries with it a high probability of duplication as employees had different registration numbers for multiple jobs.

The monthly age-wise payroll data showed that the stock of employees getting insurance under ESIC in India reduced from 29 million in September 2017 to 27 million in February 2018. The ESIC argued that the stock of existing employees paying contributions for a given month is provisional for up to at least six months because of delayed filing of contribution by the employers.

The payroll data threw up some peculiar trends – on average, about 1.5 million employees ceased to be contributors to the ESIC every month between September 2017 and February 2018, while 1.17 million new contributors joined every month. On a cumulative basis, while about 7 million workers became fresh members of ESIC, 9 million workers exited from the scheme in six months.

Source: Business Standard

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