Government to Create 3.5 Crore Jobs in 2 Years, Spend ₹1 Lakh Crore via ELI Scheme to Incentivize Employers and Support Employees

New Delhi, July 03, 2025: In a major move to boost job creation and strengthen the formal workforce, the Union Cabinet has approved the Employment Linked Incentive (ELI) Scheme, aimed at encouraging employers to hire more people — and supporting those stepping into the workforce for the first time.

🏭 Step 1: Government Encourages Employers to Hire More

To stimulate employment, especially in the manufacturing sector, the government is offering financial incentives to employers who create new jobs between August 1, 2025, and July 31, 2027.

Here’s how it works:

• Employers registered with EPFO who hire new employees will receive monthly incentives of up to ₹3,000 per employee.
• The incentive depends on the salary of the new hire: New Employee Salary Range (EPF wage)Monthly Incentive per EmployeeUp to ₹10,000Up to ₹1,000₹10,001 – ₹20,000₹2,000₹20,001 – ₹1,00,000₹3,000
• To qualify, employers must increase their workforce by at least:
  • 2 employees if they have less than 50 workers
  • 5 employees if they have 50 or more workers
• The employees must stay employed for at least 6 months to count toward the incentive.
• These benefits will be available for 2 years, with manufacturing companies getting support for an additional 2 years.

This part of the scheme aims to generate 2.6 crore new jobs and support India’s vision of becoming a global manufacturing hub.

👨‍💼 Step 2: Government Supports the New Employees

Once hired, first-time workers will receive direct financial support from the government:

• One month’s wage up to ₹15,000 will be paid in two parts:
  • After 6 months of continued employment
  • After 12 months and completion of a financial literacy course
• This benefit is available for new employees earning up to ₹1 lakh/month
• A portion of the incentive will be placed in a savings deposit, encouraging long-term financial planning
• Payments will be made via Direct Benefit Transfer (DBT) linked to Aadhaar

This component will benefit 1.92 crore first-time employees, giving them a solid start in the formal sector with not just a job but also social security coverage.

🔁 How Will You Receive the Money?

• Employees: Direct bank transfer (DBT) via Aadhaar-linked accounts
• Employers: Direct credit into PAN-linked bank accounts

💡 What’s the Big Picture?

With a total outlay of ₹99,446 crore, the ELI Scheme is part of a broader effort under the Union Budget 2024–25 to provide employment, skilling, and livelihood opportunities to 4.1 crore youth. The ELI Scheme alone aims to generate over 3.5 crore jobs in just two years — making it one of India’s most ambitious employment initiatives.

✅ In Summary: A Two-Way Push for Jobs

• Employers are rewarded for creating jobs
• New employees are supported for staying employed
• The manufacturing sector gets extra support to scale up
• Millions of young Indians will now enter the formal workforce with better security and financial backing

The ELI Scheme is more than a policy — it’s a powerful push toward a more inclusive, job-rich economy.