Did Modi government create 2 crore jobs per year? Facts vs falsehoods

Did Modi government create 2 crore jobs per year? Facts vs falsehoods

EPFO is a social security organisation responsible for providing social security benefits in the form of provident, pension and insurance funds to the organised workforce of the country covered under the provisions of Employees’ Provident Funds & Miscellaneous Provisions Act, 1952. The formal job creation under the Employees’ Provident Fund Organisation (EPFO) went up in September 2023 to 1.72 million compared to 1.69 million added in August this year. Over 0.89 million new members enrolled under EPFO during September, of which 58.9 percent of the new joinees were in the age-group of 18-25 years. This demonstrates that the majority of the members joining the organised sector workforce of the country are youth, who are mostly first-time workers.

Record 18.88 lakh or 1.88 million workers enrolled in the ESI Scheme to, in the month of September, 2023. Around 22,544 new establishments have been registered and brought under the social security umbrella of the Employees’ State Insurance Corporation (ESIC) in the month of September. More jobs have been generated for the youth of the nation as out of the total 18.88 lakh employees added during this month, 9.06 lakh employees up to the age group of 25 years constitute the majority of new registrations which is 47.98 percent of the total employees.

Gender-wise analysis of payroll data indicates that net enrollment of female members has been 3.51 lakh in September 2023. The data shows that a total of 61 transgender employees have also got registered under ESI scheme in the month of September, 2023. It also shows that ESIC is committed to deliver its benefits to every section of the society.

Another big evidence that the Modi government has created jobs aplenty is the poverty data. In India, the number of people living in extreme poverty – defined by the World Bank as living on US$1.9 or less in purchasing power parity (PPP) terms – was only 0.8 percent of the population in the pre-pandemic year 2019, stated the IMF paper, published in April 2022. Real (inflation-adjusted) inequality, as measured by the Gini coefficient, which stands at 0.294, is now very close to its lowest level 0.284 observed in 1993-94, the IMF paper further stated. The Gini coefficient ranges from 0 to 1, with 0 representing perfect equality and 1 representing perfect inequality.

True, India has almost eradicated extreme poverty and brought down consumption inequality to its lowest levels in 40 years through food handouts and free rations, but what has gone unnoticed is the sweeping change brought in by targeted employment generating schemes like the Prime Minister’s Employment Generation Programme (PMEGP).

Under PMEGP, maximum project cost admissible for setting up of new projects was enhanced from Rs 25 lakh to Rs 50 lakh for the manufacturing sector and from Rs 10 lakh to Rs 20 lakh for the services sector. PMEGP is a credit linked subsidy scheme providing employment opportunities through establishment of micro-enterprises in the non-farm sector. Geo-tagging of the PMEGP units has been initiated for capturing the details of the products and services offered by the units and to create market linkages for them.

Since its inception, under PMEGP, more than 8.34 lakh enterprises have been set up generating an estimated employment of around 68 lakh. Around Rs 20,600 crore was disbursed as on December 2022, as margin money subsidy.

In FY 22, PMEGP exceeded the previous year’s performance by disbursing Rs 2978 crore (36 percent higher than FY 21) as margin money subsidy, assisting 1.03 lakh units (around 39 percent higher than FY 21) and generating employment for around 8 lakh people in a single year, which is the highest since inception of the scheme in 2008.

Under Credit Guarantee Scheme for Micro and Small Enterprises (CGTMSE), collateral free loan up to a limit of Rs 2 crore to micro and small enterprises (MSEs) is provided. In FY 23, over 7.5 lakh guarantees were approved involving over Rs 60,376 crore, which is the highest since inception of the scheme in 2000-01. With effect from December 2022, for credit ceiling up to Rs 2 crore, the maximum extent of guarantee cover has been enhanced to 85 percent. Enterprises owned by women would be eligible for guarantee cover of 85 percent.

Both CGTMSE and PMEGP have been big catalysts in job creation under the Modi government. This whole narrative about not enough jobs being created is a whole lot of hogwash and vested propaganda by a debilitated Opposition which has failed to counter PM Modi’s immense popularity.

In 2013 there were barely 7700 StartUps. Thanks to PM’s Modi’s focus on innovation and entrepreneurship, today in just the last nine years, India has become the world’s 3rd largest StartUp destination with over 98,000 StartUps and over 111 Unicorns. These numbers, taken along with the EPFO, ESIC, Rozgar Mela, PMEGP and of course the game-changing Mudra Yojana numbers, endorse the fact that Prime Minister Modi has indeed delivered, an average of well over 2 crore jobs per year that were promised, by providing not just gainful employment, but self employment to a whole breed of aspirational Indians.

A decrepit opposition, with Congress leader Rahul Gandhi included, has been peddling false narratives about jobless growth under the Modi government. The pleasant truth however is that in the last 9.5 years, India has seen the highest ever job creation.

India’s unemployment rate for individuals aged 15 and above reached a six-year low of 3.2 percent during the period from July 2022 to June 2023, as per the Periodic Labour Force Survey (PLFS) annual report 2022-2023 released by the National Sample Survey Office (NSSO). The unemployment rate is defined as the percentage of unemployed persons in the labour force. PLFS was launched by the NSSO in April 2017 to provide accurate labour force data. The unemployment rate in usual status for persons aged 15 years and above at the all-India level decreased to 3.2 percent in 2022-23 from 4.1 percent in 2021-22. The UR was 4.2 percent in 2020-21, 4.8 percent in 2019-20, 5.8 percent in 2018-19, and 6 percent in 2017-18, according to the PLFS. The survey distinguishes usual status, which determines a person’s employment status based on the reference period of 365 days preceding the survey date.

The PLFS data revealed a notable decline in unemployment rates in both rural and urban areas. In rural regions, the unemployment rate decreased from 5.3 percent in 2017-18 to 2.4 percent in 2022-23, while in urban areas, it decreased from 7.7 percent to 5.4 percent. The unemployment rate for males in India decreased from 6.1 percent in 2017-18 to 3.3 percent in 2022-23, with a corresponding decrease for females from 5.6 percent to 2.9 percent. The survey also showed a significant increase in the Labour Force Participation Rate (LFPR) in usual status for individuals aged 15 and above, rising to 57.9 percent from 49.8 percent in 2017-18. LFPR is defined as the percentage of persons in the labour force — those working, seeking work, or available for work — in the population. For rural areas, LFPR increased from 50.7 percent in 2017-18 to 60.8 percent in 2022-23, while for urban areas, it increased from 47.6 percent to 50.4 percent. The LFPR for males in India increased from 75.8 percent in 2017-18 to 78.5 percent in 2022-23, with a corresponding increase for females from 23.3 percent to 37.0 percent. The Worker Population Ratio (WPR) in usual status for persons aged 15 and above also increased to 56 percent in 2022-23 from 46.8 percent in 2017-18. WPR is defined as the percentage of employed persons in the population. For rural areas, WPR increased from 48 percent in 2017-18 to 59.4 percent in 2022-23, while for urban areas, it increased from 43.9 percent to 47.7 percent. The WPR for males in India increased from 71.2 percent in 2017-18 to 76 percent in 2022-23, and the corresponding increase in WPR for females was from 22 percent to 35.9 percent. The Periodic Labour Force Survey collects data on a yearly basis.

A recent State Bank of India report, has identified flaws in Consumer Pyramids Household Survey by the Centre for Monitoring Indian Economy (CMIE) and rightfully so.

CMIE’s data is subjective and CMIE which is run by Mahesh Vyas (Vyas, an acolyte of P Chidambaram, was involved in drafting Congress manifestos for various elections) has an inherently biased methodology, which is unreliable. Many demographic sections are grossly under or over-represented in the CMIE methodology, making CMIE’s analysis subjective, irresponsible and opaque.

PLFS data released by the NSSO, is however objective, reliable and transparent. The fact that unemployment rate as per PLFS has fallen from 6.1 percent in FY 18 to 3.2 percent in FY 23, is the biggest proof that the Modi government has decisively won the war against unemployment.

There has been a noteworthy increase in the LFPR, rising from 36.9 percent to 42.4 percent during this period, with the female LFPR outpacing the overall LFPR gain. Historically, the rise in the self-employed population, particularly driven by an increase in household helpers, has been misconstrued as a signal of shrinking employment opportunities. However, government initiatives such as the Pradhan Mantri Mudra Yojana (PMMY) and post-pandemic schemes like PM SVANidhi have contributed to a structural transformation in labour markets by formalising credit for the self-employed. Under SVANidhi over 50 lakh hawkers and street vendors have benefitted to the tune of Rs 95000 crore worth of loans at concessional rates. Not only has the Modi government created jobs aplenty but it has also ensured last mile delivery while doing so.

The steady decline from 6.1 percent in the inaugural PLFS of 2017-18 has come on the back of improvements in both urban and rural areas, and across education levels and genders. These PLFS numbers completely debunk the long-running criticism of jobless growth allegations against the Modi government. The picture in fact, goes deeper than the headline numbers. As many as 57.3 percent of the workers are now self-employed. That share has grown sharply from 52.2 percent six years ago and is ample proof of how young India is no longer unduly dependent on government jobs but is finding its own niche areas to prosper, given the excellent,enabling environment provided by the Modi government.

The youth unemployment rate, despite showing a decline from 12.9 percent to 10 percent in the 15-29 age group, is often cited erroneously as a proxy for shrinking employment opportunities. But that is false. What the fall truly reflects is a changing employment-education pattern, with the men/women now remaining in the education system at least until the age of 23-24 years, which used to be only up to 17 years earlier. More youngsters are now getting into higher education than say 10 or 20 years ago.

The Aatmanirbhar Bharat Rojgar Yojana (ABRY) was launched with effect from 1st October, 2020 to incentivize employers for creation of new employment and restoration of loss of employment during Covid-19 pandemic. An employee drawing a monthly wage of less than Rs 15,000/- who was not working in any establishment registered with the Employees’ Provident Fund Organization (EPFO) before 1st October, 2020 was eligible for the benefit. The employees who lost their job during Covid-19 pandemic and did not join in any EPF covered establishment up to 30th September 2020 were also eligible for the benefit.The Modi government for a period of over two years thereafter, has been crediting both the employee share (12 percent of wages) and employer’s share (12 percent of wages) of contribution payable, or only the employee’s share, depending on employment strength of the EPFO registered establishments.

The scheme commenced from 1st October 2020 and registration was open for eligible employers and new employees up to 31st March, 2022.The scheme was intended to benefit a total of 71.80 lakh members. Total registration under the scheme on last count was well over 75.11 lakh, spread over 3.1 lakh establishments in the country. Needless to add, ABRY has been a massive catalyst in employment generation, which is something India’s fractious Opposition has failed to digest and a left leaning media has failed to report.

Besides employment opportunities provided under Rozgar Mela and ABRY, a whopping 8.41 crore rural women members have been mobilised through Deendayal Antyodaya Yojana – National Rural Livelihoods Mission, (DAY-NRLM), into 77.4 lakh Self-Help Groups (SHGs). DAY-NRLM has been mobilised across 721 districts and 6842 blocks of 34 States and Union Territories. These SHGs have been federated into 4.37 lakh Village Organisations (VOs) and over 28,000 Cluster Level Federations (CLFs).DAY-NRLM has also trained around 4 lakh Community Resource Persons (CRPs) who are skilled in different thematic areas such as gender equity, financial inclusion, livelihood promotion and nutrition. Over 39 lakh SHGs have been provided with revolving funds and over 22 lakh SHGs have been also provided with Community Investment Funds (CIFs) as capital support. Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) under the Modi government is also going beyond its conventional role of acting just as a source of rural employment for women, to becoming a dynamic platform to place demands for village community work, to negotiate for space and power with gram panchayats and for networking. The convergence between SHGs and the panchayats enables them to work together to better implement MGNREGS, strengthen the unity of their collective, and fulfil some of the key objectives of DAY-NRLM.

In rural areas, women come together under SHGs to address their common problems, such as by engaging in weekly savings to create a corpus of funds – for activities known as ‘thrift’ and ‘credit’ – for use in personal emergencies or to tide over pressing needs. Their participatory planning process involves discussions and drawing up demands for the development of their villages. Faulting previous governments for not taking adequate measures to economically empower women in the country, Prime Minister Narendra Modi has rightfully repeated on various platforms that his government has been constantly creating an environment in which women self-help groups can make villages more prosperous.

The movement of women oriented SHGs has intensified in the last 9.5 years under the aegis of PM Modi, with over 80 lakh of them working across the country– a figure over three times more than was the case under the erstwhile Congress regime. Over eight crore women are gainfully employed and connected with these groups. Be it manufacturing masks and sanitisers or delivering food to the needy and spreading awareness, the contribution of SHGs and ‘Sakhi groups’ was incomparable in every way, during Covid. An important decision was taken during the pandemic to raise the loan amount for SHGs from Rs 10 lakh to Rs 20 lakh without any guarantee, by the Modi government. Also, Rs 1625 crore was released as a capitalisation support fund to over four lakh such groups. In addition, the Modi government also released Rs 25 crore as seed money for 7500 SHG members under the PM Formalisation of Micro Food Processing Enterprises Scheme of the Ministry of Food Processing Industries and Rs 4.13 crore as funds to 75 FPOs (Farmer Producer Organisations) being promoted under the mission.

There are now more than 50 crore Jan Dhan accounts of which over 56 percent are held by women, making women central to the entire process of financial inclusion and generation of rural employment. These bank accounts made it easier for women working with SHGs to take loans from banks. Unsecured loans of about Rs 4 lakh crore have been made available to these SHGs in the last 9.5 years.

PM Modi has, time and again, spoken about the power of the youth and how they have the ability and the opportunity to change the world. From being job creators as entrepreneurs, to their technological abilities, the PM has emphasised upon the important role the youth of India has to play for the growth of our country. The prime minister has focused upon the concept of “Yuva Devo Bhava, Yuva Shakti Devo Bhava”.

As India under Modi, transitions from being an economy of job seekers to that of job creators, both tailor-made employment schemes like ABRY and SHGs led by young and aspirational India, will redefine the very concept of employment generation, making it more inclusive, with a focus on shared values and shared goals.

One of the biggest game changers under PM Narendra Modi’s aegis is the PM Mudra Yojana (PMMY), which has turned India from an economy of job seekers to an economy of job creators, with over 23.5 crore worth of loans extended to 41 crore beneficiaries.

As many as 8 crore people under PMMY are those who have taken a loan for the first time ever. Over 68 percent of the PMMY beneficiaries are women entrepreneurs, and 51 percent belong to entrepreneurs in the SC/ST and OBC categories. This demonstrates that the easy availability of credit to the budding entrepreneurs of the country has not only led to innovation and a sustained increase in per capita incomes but has also given massive impetus to the essence of self-employed Indians, who are productively and gainfully employed at the grassroot level.

Additionally the growth of MSMEs has contributed massively to the “Make in India” programme as strong domestic MSMEs lead to increased indigenous production both for domestic markets as well as for exports, adding a large number of jobs in the process.

Be it the Mudra Yojana which aims to provide collateral-free access to credit in a seamless manner to micro-enterprises in the country, targeted employment to millions via Rozgar Melas, schemes like ABRY and PMEGP or even the sheer number of formal jobs as showcased by EPFO and ESIC data, the fact remains, unemployment has hit a record low of 3.2 percent under the Modi government. And needless to add, India’s growing prowess as the world’s fastest growing economy for the third year in a row, is all about how Modinomics has deftly ensured sustainable economic growth without sacrificing jobs and equity.

The author is an Economist, National Spokesperson of the BJP and the Bestselling Author of ‘The Modi Gambit’. Views expressed in the above piece are personal and solely that of the author. They do not necessarily reflect Firstpost’s views.

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