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'Return to normalcy' as EPFO adds 10.06 lakh net subscribers in August

After a shaky first quarter, the negative impact of the pandemic is now dissipating as EPFO subscriber base increased by around 20 lakh during the first five months of the current fiscal

twitter-logoBusinessToday.In | October 20, 2020 | Updated 20:34 IST
'Return to normalcy' as EPFO adds 10.06 lakh net subscribers in August

Provisional data released by the Employees' Provident Fund Organisation (EPFO) showed 10.06 lakh net enrolments during August this year. The pension fund body stated that the recovery pattern has further improved in August, marking a return to normalcy after a tumultuous period in the employment scenario due to coronavirus pandemic.

Due to the coronavirus-led disruptions, net EFPO enrolments had declined more than 1.04 lakh and 35,000 in April and May, respectively. Growth returned in June with net enrolments rising 3.85 lakh and 7.49 lakh in July.

"During July 2020 around 7.49 lakh, net new subscribers were added which is approximately 64 per cent of the net additions made during the corresponding month of previous year, i.e., July 2019. The enrolment recovery pattern has further improved in August 2020 where net new additions are roughly 93 per cent of the net growth in membership recorded in August 2019. This is suggestive of return to normalcy regarding subscriber base growth for EPFO," the provident fund body said.

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EPFO payroll data for August showed that its subscriber base increased by around 20 lakh during the first five months of the current fiscal. After a shaky first quarter, the negative impact of the pandemic is now dissipating, EPFO said.

"COVID-19 pandemic and subsequent lockdown across the country had adversely affected the enrolments during the first quarter of the current financial year. However, the provisional payroll figures for the month of July and August 2020 are indicative of the slow dissipation of the negative impact of the COVID-19 pandemic outbreak and gradual recovery to pre-COVID levels," the pension fund body said.

EPFO net enrolments recorded 34 per cent month-on-month growth in August over July. The organisation attributed the growth to increase in number of new subscribers and lower exits by members.

"The new subscriber joining has increased from 6.48 lakh in July 2020 to 6.70 lakh in August 2020. In addition, the exits from EPFO subscriber base declined by more than 50 per cent, from 5.08 lakh in July to 2.46 lakh in August 2020," it said.

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Around 5.81 lakh members had exited and then rejoined EPFO during August 2020. These subscribers switched jobs within the establishments covered by EPFO and choose to retain their membership by transferring funds rather than opting for final settlement. The data published comprises of all the new members who have joined during the month and whose contribution has been received.

Age-wise analysis indicated that maximum numbers of new additions during August 2020 were from the 22-25 years age bracket, followed by 18-21 age bracket. The 18-25 age-group members can be considered as first-time employees in the workforce and have shown strong revival by contributing almost 51 per cent of the new subscribers.

Across the States, comparison of payroll figures reveals that the States of Maharashtra, Tamil Nadu, Gujarat, Karnataka and Haryana remain at the forefront of the enrolment recovery cycle adding approximately 57 per cent of the total 21.40 lakh net new subscribers added during June, July and August 2020 combined.

Category-wise analysis of industry indicates 'expert services' category (which primarily includes manpower agencies, private security agencies and small contractors) has been the most resilient as far as recovery is concerned, contributing a combined net payroll figure of 11.20 lakh for June, July and August 2020, which is approximately 63 per cent of the total net payroll for these three months for the top ten industry categories.

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