The government is likely to extend the Atmanirbhar Bharat Rozgar Yojana that offers incentives to the private sector for creating new jobs as the country stares at high unemployment due to the severe second wave of the Covid-19 pandemic. The scheme is likely to be extended beyond June 30, a top government official told ET, adding that a decision is expected shortly.

Under the scheme, the government pays the provident fund contribution by the employer and employee for a period of two years for new hires by establishments employing up to 1,000. This comes to 24% of basic pay–contributions of 12% each by employer and employee. For enterprises with more than 1,000 workers, the reimbursement is restricted to the employee contribution of 12%. The scheme is applicable for those earning less than Rs 15,000 a month.

Launched after the first wave of the pandemic, the scheme was for a nine-month period–October 1, 2020, to June 30, 2021.

“Government can extend the scheme for at least six more months. A notification to this effect could come closer to June 30, when the scheme officially ends,” the official said.

Over 15m Jobs Lost in May: CMIE

The government, which budgeted Rs 22,810 crore for the scheme until 2023, had targeted 5.5 million enrolments but so far there have been only about 2 million registrations as per labour ministry data. This implies the government has enough fiscal room within the budgeted amount to extend the scheme.

The Prime Minister announced on Monday that the government was extending the Pradhan Mantri Garib Kalyan Ann Yojana free food programme until November. More measures are in the offing to provide relief in a targeted manner.


According to the Centre for Monitoring Indian Economy, more than 15 million jobs were lost in May, leading to a sharp jump in the unemployment rate to 11.9%, its highest level in the past one year, compared with 7.9% in April.

Total employment fell to 375.5 million in May from 390.8 million in April, as states imposed restrictions in the wake of the second wave. The unemployment rate had fallen to 10.18% in June 2020 after touching the peak of 23% in April and May 2020 amid the nationwide lockdown during the first wave.

Both rural and urban centres were hit hard. The urban unemployment rate rose to 14.73% in May from 9.78% in April, according to CMIE. The rural unemployment rate stood at 10.63% against 7.13% in April 2021.

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