The Union Cabinet on July 1, 2025, approved the Employment Linked Incentive Scheme (ELI), named “PM Viksit Bharat Rozgar Yojana.”
The scheme was earlier announced in the Union Budget 2024-25 as an innovative initiative intended at addressing the country’s increasing employment challenges.
As India tackles high levels of youth unemployment, underemployment, and a mismatch between skills and industry demands, the scheme emphasizes stimulating private sector participation in job creation and workforce development.
The scheme seeks to motivate employers to hire more labor, precisely freshers, while also encouraging skill development and job retention.
About PM Viksit Bharat Rozgar Yojana:
The Government of India approved the Pradhan Mantri Viksit Bharat Rozgar Yojana to support employment generation, enhance employability, and provide social security across all sectors, with a special focus on the manufacturing sector.
Pradhan Mantri Viksit Bharat Rozgar Yojana is a Central Sector Scheme.
The scheme will be implemented by the Ministry of Labour & Employment through the Employees’ Provident Fund Organisation (EPFO).
The benefits of the scheme would be applicable to jobs created between 01st August 2025 and 31st July 2027.
The scheme aims to incentivize the creation of more than 3.5 crore jobs in the country over a period of 2 years.
Key Objectives
The scheme aims to address India’s employment crisis by incentivizing the private sector for job creation, retention, and skill development.
- Enhance private sector employment opportunities by encouraging companies to recruit additional staff
- Promote youth employment, especially individuals joining the workforce for the first time
- Promote job retention by offering incentives to employers who maintain workforce levels
- Encourage skill advancement by motivating employers to invest in training
- Enhance formal employment by offering incentives to employers who transition workers into the formal economy
- Improve employment in the manufacturing sector
- Decrease economic disparity and improve social mobility
- Assist employers in recruitment by providing financial assistance such as reimbursing PF contributions
Structure of the Scheme
The Employment Linked Incentive program includes schemes aimed at employment generation, workforce formalization, skill development, and enhancing industry compliance.
Scheme A: Support for First-Time Employees
This scheme targets individuals entering the formal workforce for the first time and is facilitated through EPFO.
- One-month wage subsidy up to ₹15,000
- Disbursed in two installments
- Applies to all sectors
- Workers must complete an online financial literacy course before claiming the second installment
- Employers receive refunds if the employee leaves within 12 months
Scheme B: Incentivising Job Creation in Manufacturing
Designed to foster employment in the manufacturing sector, this scheme rewards employers and first-time employees.
- Minimum additional hires depending on company size
- Incentive duration extends for four years
- Contributions shared between employer and employee
- Wage cap up to ₹1 lakh
- Applicable to manufacturing employers with EPFO track record
Scheme C: Employer Support for EPFO Contributions
This scheme offers financial relief to employers.
- Reimbursement up to ₹3,000 per month per new employee
- Applicable for two years
- Extended support for employers adding large number of jobs
- Quarterly reimbursements
Financial Outlay and Coverage
Each scheme has been designed with targeted durations and substantial financial support.
- ₹99,446 crore allocated for first-time employees
- ₹52,000 crore for manufacturing employment
- ₹32,000 crore for employer support
The scheme is expected to benefit:
- More than 3.5 crore beneficiaries
- Around 30 lakh manufacturing jobs
- 50 lakh employer beneficiaries
Eligibility Criteria
For Employees
- First-time employees entering formal workforce
- Salary within prescribed limit
- Must be EPFO members
- Must complete required employment duration
For Employers
- Must be registered under EPFO
- Must increase workforce
- Must maintain employment levels
Benefits of PM Viksit Bharat Rozgar Yojana
The scheme offers several key benefits:
- Promotes job creation by encouraging businesses to hire more employees
- Supports fresh graduates and individuals new to the formal workforce
- Encourages workforce expansion for employers
- Reduces financial burden for employers
- Boosts economic growth
- Enhances financial security for employees
- Encourages formalisation of the workforce
Implementation and Process
- Implemented through EPFO
- Employees become eligible after joining formal workforce
- Incentives linked with EPFO contributions
- Financial benefits credited after completion of required period
Timeline of the Scheme
- Applicable for jobs created between 01 August 2025 and 31 July 2027
Key Highlights
- Incentive up to ₹15,000 for employees
- Incentive up to ₹3,000 per month for employers
- Focus on manufacturing sector
- Encourages formal employment
- Supports job retention and skill development
Role in Employment Generation
The scheme emphasizes stimulating private sector participation in job creation and workforce development.
By recommending subsidies for new hires and rewards for job retention and upskilling, the scheme aims to create an inclusive and robust labor market.
Conclusion
The Pradhan Mantri Viksit Bharat Rozgar Yojana is an initiative aimed at employment generation, workforce formalization, and economic growth.
By incentivizing both employees and employers, the scheme supports job creation, skill development, and long-term employment opportunities across sectors.
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