Understanding the Employment-Linked Incentives in Union Budget 2024

Overview

The Union Budget 2024, presented by Finance Minister Nirmala Sitharaman, introduces five novel schemes with a significant outlay of ₹2 lakh crore. These initiatives are designed to generate jobs and enhance skill development, addressing the pressing issues of rising unemployment rates and job losses.

Key Schemes

• Employment-Linked Incentive Schemes:
  • Scheme 1:
    • Focuses on recognizing first-time employees while providing support to both employees and employers.
    • Offers a direct benefit transfer of one-month salary in three installments to newly employed workers registered in the Employees’ Provident Fund Organisation (EPFO).
    • Eligibility: Salary must be up to ₹1 lakh per month.
    • Anticipated to benefit 210 lakh youth.
  • Scheme 2:
    • Encourages additional employment in the manufacturing sector, linked to EPFO contributions for first-time employees during their initial four years.
    • Expected to support 30 lakh youth and their employers.
  • Scheme 3:
    • Covers additional employment across all sectors.
    • Government will reimburse employers up to ₹3,000 per month for two years as support for their EPFO contribution for each additional employee.
• Skill Development Scheme:
  • Aims to skill 20 lakh youth over a span of five years.
  • Upgrades 1,000 Industrial Training Institutes in hub-and-spoke arrangements with a focus on outcome orientation.
• Internship Scheme:
  • Will provide internship opportunities for one crore youth over the next five years in 500 top companies.
  • Government will offer an internship allowance of ₹5,000 per month along with a one-time assistance of ₹6,000.

Significance

• Job Creation:
  • These schemes are poised to generate a substantial number of jobs, directly tackling the issues of unemployment and underemployment.
• Skill Enhancement:
  • Emphasis on skilling and upskilling the youth ensures they are better prepared for the competitive job market.
• Support for Employers:
  • Financial incentives for employers to hire more employees, particularly first-time workers, are a significant aspect of these schemes.

Conclusion

The Union Budget 2024 proposes comprehensive measures to address unemployment and enhance skill development. By focusing on employment-linked incentives, skill training, and internship opportunities, these initiatives aim to create a robust job market and provide ample opportunities for the youth.