The Budget for 2024-25 introduced a series of innovative measures to boost employment and support employers, acknowledging the vital role of job creation in driving economic growth. These measures aim to incentivize both employees and employers, ensuring a dynamic and resilient labor market. There are three major schemes announced for ‘Employment Linked Incentive’ by Finance Minister Nirmala Sitharaman under Prime Minister’s Package
Scheme A: First-Time Employees
To encourage the hiring of first-time employees, the government has introduced incentives linked to EPFO contributions:
Employee and Employer Incentives: Both employees and employers will receive incentives for EPFO contributions according to specified scales for the first four years of employment.
Expected Impact: This scheme is expected to benefit 30 lakh youth by facilitating their entry into the formal workforce.
Scheme B: Job Creation in Manufacturing
This scheme focuses on enhancing employment opportunities in the manufacturing sector:
Government Reimbursement: The government will reimburse EPFO contributions of employers up to ₹3,000 per month for two years for all new hires.
Job Creation Goal: This initiative is projected to generate 50 lakh jobs, significantly boosting employment in the manufacturing sector.
Scheme C: Support to Employers
Recognizing the importance of easing the financial burden on employers, the government has introduced:
Wage Support: New entrants in all formal sectors will receive one-month wages in three installments, up to ₹15,000.
Beneficiaries: This support is expected to benefit 210 lakh youth, aiding their transition into stable employment.
Skilling Programmes
To ensure that the workforce is equipped with the necessary skills, the budget includes comprehensive skilling programmes:
– Youth Skill Development: Over a five-year period, 20 lakh youth will be skilled through various training initiatives.
– Industrial Training Institutes (ITIs): 1,000 ITIs will be upgraded to a hub and spoke arrangement with a focus on outcome-oriented training. Course content and design will be aligned with the skill needs of the industry.
