India is in need of a credible system of mapping job creation or any other reverse trend, so that the government’s policies along with those of several other sectors such as financial markets, consumer goods companies, automobile manufacturers and real estate are anchored accordingly, the ASSOCHAM said.
“Like we release inflation data, industrial output numbers and several other high-frequency data every month, we must create a system sooner than later so that the payroll numbers are released month-on-month,” said ASSOCHAM Secretary General, D S Rawat.
As per the chamber, if a part of our economy is getting formalised, the mapping of job creation should not be difficult.
“We do not need traditional sample surveys. Since the wages are all paid through banking channels, we can just capture the salary data from the banks and collate it, compare it,” he argued.
While there could still be some doubt left whether job creation in the formal sector is additional employment or a shift from the informal to formal, monthly data can make it clear that it is about the fresh jobs in the formal sector, and thus improving the job database.
As per the ASSOCHAM, the existing system of job mapping lacks the dynamism and somewhat comes with a lag. Furthermore, issues of sectoral mapping persist.
“First, let there be a simple data from the banks as to how many new salary accounts were opened… With the banks’ network linked along with the PAN of the Income Tax (in most cases), the overlap with regard to shifting of manpower from one organisation to the other and from one bank account to the other can be sorted out by the technological tools,” it suggested.
The chamber also noted that for any mature economy, the payroll data is crucial for anchoring policies with regard to interest rates, welfare measures, investment incentives, taxation.
On the other hand, for rural jobs, it is almost given that the migration continues to take place from the agriculture and allied sectors to the other areas and from villages and small towns to bigger cities.
The ASSOCHAM said the national economic policies must be data-driven rather than anecdotal pieces of information, collected from here and there. Besides, there should one central agency responsible for this, it opined.
“Too many departments and agencies should not be encouraged to come out with their own data. They should collate all the information at one point and then release it,” it added.
In April this year, the NITI Aayog said payroll data from the Employees’ Provident Fund Organisation (EPFO), the Pension fund Regulatory and Development Authority (PFRDA), and the Employees’ State Insurance Corporation (ESIC) would now be released every month.
The government’s think tank also said other organisations such as the Institute of Chartered Accountants of India (ICAI), Bar Council, Medical Council and other professional bodies could have such monthly data for payroll reporting for their professionals.