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A Decade Of Employment Reforms

IAS Current Affairs

A Decade Of Employment Reforms

Source: Indian Express
GS II: Government policies and interventions, Welfare Schemes GS III: Employment, Inclusive Growth

Overview

  1. News in Brief
  2. Key Highlights
  3. Pradhan Mantri Viksit Bharat Rozgar Yojana (PMVBRY)
  4. Way Forward

Why in the News?

Union Minister of Labour & Employment and Youth Affairs & Sports highlighted India’s employment and social security achievements over the last decade.

News in Brief
  • The Minister emphasized the role of government reforms in boosting job creation, skill development, and workforce participation.
  • The government showcased significant progress in expanding social security and formal employment opportunities.
  • The launch of the Pradhan Mantri Viksit Bharat Rozgar Yojana (PMVBRY) was highlighted as a major employment-generation initiative.
Key Highlights

India’s Transformation Over The Last Decade

  • India moved from being among the fragile five economies in 2013 to one of the world’s fastest-growing major economies.
  • Built a large start-up ecosystem and strengthened digital public infrastructure.
  • Improved its global economic standing through governance and inclusive development.

Youth-Centric Development Initiatives

Major initiatives launched to harness India’s demographic dividend

Employment Growth Trends

  • Employment elasticity increased to 1.11 during 2017-18 to 2023-24.
  • Indicates that every 1% increase in Gross Value Added (GVA) was associated with a 1.11% rise in employment.
  • Significant improvement from 0.008 during 2011-12 to 2017-18.

Job Creation in India

According to the RBI KLEMS data

  • More than 17 crore jobs were created between 2014 and 2024.
  • Employment rate increased from 46.8% (2017-18) to 57.4% (2025).
  • Unemployment rate declined to around 3.1%, below the global average of 4.8%.
  • EPFO payroll data indicates over 8 crore formal-sector jobs added between 2017 and 2025.

Expansion of Social Security Coverage

  • Social Security coverage increased from 25 crore people (19%) in 2015 to over 94 crore people (64.3%) in 2025.
  • India received the International Social Security Association (ISSA) Award for Outstanding Achievement in Social  Security 2025.
Pradhan Mantri VIksit Bharat Rozgar Yojana (PMVBRY)
  • Introduced in the first budget of the Government’s third term.
  • Largest employment-linked incentive scheme in independent India.
  • Total outlay: Nearly rupees 1 lakh crore
  • Aims to create over 3.5 crore employment opportunities over two years.

Key Features

Part A, Incentive for First-Time Employers

  • Financial assistance of up to rupees 15,000.
  • Paid in two instalments.

Part B, Incentive for Employers

  • An incentive of up to rupees 3,000 per employee per month.
  • Available for every additional worker employed.
  • Incentives up to
    • 4 years for eligible manufacturing employers.
    • 2 years for employers in other sectors.

Benefits

  • Encourages formal employment
  • Increases workforce participation
  • Direct financial support to workers
  • Makes jobs more attractive
  • Supports industrial growth through employer incentives.
  • Strengthens employer-employee partnership.

Significance of PMVBRY

  • Promotes employment generation at scale.
  • Encourages labour-intensive industries.
  • Enhances income security for workers.
  • Supports India’s goal of becoming a developed nation by 2047.
  • Reinforces inclusive and sustainable economic growth.

Challenges and Concerns

  • Ensuring quality and sustainable employment.
  • Monitoring actual job creation outcomes
  • Addressing informal sector employment gaps.
  • Effective implementation across states and industries.
  • Preventing misuse of employment-linked incentives.
Way Forward
  • Strengthen skilling and reskilling programmes.
  • Improve labour market data systems.
  • Expand social security to informal workers.
  • Enhance industry-academia collaboration.
  • Ensure regular monitoring and evaluation of employment schemes.
  • Promote labour-intensive sectors such as textiles, food processing and MSMEs.
  • Enhance women’s access to formal employment.
  • Focus on quality jobs rather than merely employment numbers.

Conclusion

  • India’s employment-focused reforms recognise employees and employers as equal partners in nation-building.
  • It reflects that the government seeks to ensure that workers are protected, enterprises are empowered, and the benefits of growth are widely shared as India advances towards Viksit Bharat 2047.
UPSC Prelims Practice Question

Consider the following Statements regarding PM Viksit Bharat Rozgar Yojana (PMVBRY)

    1. It aims to promote formal employment through incentive-based support.
    2. It is exclusively targeted at government sector employment.
    3. It is the largest employment-linked incentive scheme in independent India.

Which of the above statements are correct?

a) 1 and 2 only

b) 2and3 only

c)1and 3 only

d)1,2, and 3

Answer: c) 1 and 3

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