Finance Minister Nirmala Sitharaman has introduced three new employment-linked incentive schemes in the Union Budget for 2024-25. These schemes aim to increase job opportunities in the manufacturing and other formal sectors of the economy. Here's an explanation of what these schemes are and how they will benefit the lower to middle-class population in India.
Scheme A: First-Timers
Table of contents [Show] Helping New EmployeesThe first scheme, known as Scheme A, is designed to support individuals who are entering the workforce for the first time. This scheme will provide a direct benefit transfer of one month’s salary in three instalments to first-time employees who are registered with the Employees Provident Fund Organisation (EPFO). |
Financial SupportThe maximum amount an individual can receive under this scheme is Rs 15,000, and it is available to those earning up to Rs 1 lakh per month. This scheme is expected to benefit approximately 210 lakh (21 million) young people in India. |
Who Benefits?If you are a new employee just starting your career, this scheme can give you a financial boost by providing additional income. It recognises and supports first-time employees, helping them to start their professional journey with a bit more financial security. |
Scheme B: Job Creation in Manufacturing
Incentives for Manufacturing JobsScheme B focuses on creating more jobs in the manufacturing sector. It aims to incentivise the hiring of first-time employees in manufacturing industries. Both employee and employer will receive incentives based on their contributions to the EPFO during the first four years of employment. |
Supporting GrowthThis scheme will benefit 30 lakh (3 million) young people and their employers. By providing financial support to both parties, the scheme encourages businesses to hire more people, thus boosting employment in the manufacturing sector. |
Who Benefits?If you are looking for a job in manufacturing or already working in this sector, this scheme can help you by providing additional financial support. It also encourages employers to create more job opportunities, which can be beneficial for job seekers. |
Scheme C: Support to Employers
Encouraging Additional EmploymentThe third scheme, Scheme C, is designed to support employers who hire additional employees. This scheme will reimburse employers up to Rs 3,000 per month for two years towards their EPFO contributions for each additional employee hired within a salary bracket of Rs 1 lakh per month. |
Boosting Employment Across All SectorsThis scheme is expected to incentivise the hiring of 50 lakh (5 million) additional employees across various sectors. By lowering the financial burden on employers, the scheme encourages them to hire more workers, thus creating more job opportunities. |
Who Benefits?If you are an employer looking to expand your workforce, this scheme can help by reducing your financial obligations. For job seekers, this means more job opportunities as businesses are encouraged to hire more people. |
These three employment-linked incentive schemes introduced by Finance Minister Nirmala Sitharaman aim to boost job creation in India, particularly benefiting the lower to middle-class population. By providing financial support to both employees and employers, these schemes encourage the hiring of first-time employees and the creation of additional job opportunities in the manufacturing sector and beyond.
The Finance Minister also announced a comprehensive internship scheme under the PM’s Budget package, aiming to provide internship opportunities in 500 top companies to 1 crore youth over 5 years. Interns will gain 12 months of exposure to real-life business environments, various professions, and employment opportunities. Each intern will receive an allowance of Rs 5,000 per month, along with a one-time assistance of Rs 6,000. Companies will be required to cover the training cost and 10 percent of the internship cost from their CSR (corporate social responsibility) funds.
Whether you are a new entrant to the workforce, an employee in the manufacturing sector, or an employer looking to expand your team, these schemes offer financial incentives that can help improve your financial stability and support the growth of the Indian economy.
