Hiring trend: India Inc favours experience over youth in post-pandemic shift, shows EPF data

Experience finds place in formal job market

India’s formal sector employers are preferring experience over age while hiring post pandemic, going by the Employees’ Provident Fund Scheme additions, despite nearly half of the population being below 25 years of age compared with just over a quarter for China.

A Moneycontrol analysis of Ministry of Statistics and Programme Implementation data shows, the share of those aged 29 and above in the net additions to the Employees’ Provident Fund Scheme rose to 36.6 percent in FY24 compared with 21.7 percent in FY19.

The rise has come at the expense of younger workers as their share declined to 25.2 percent in FY24 from 39.9 percent five years ago.

The reasons

Experts say that people opting for higher studies and easy availability of experienced workers at lower cost post-Covid might be reasons for this shift.

“After the pandemic it has become easier to retain a retired employee. If you employ a younger person, the liability is higher in terms of benefits that need to be given,” said Satyaki Roy, associate professor, Institute for Studies in Industrial Development.

Early entrants (aged below 21) constituted a third of additions to the EPF scheme in FY20 but declined to 28.7 percent during the pandemic and 24.8 percent in FY22.

The share of those aged 22-28 has held steady at around 38-39 percent over the years.

The trend also exists for lower remunerative jobs as well. The ratio of experienced employees in the Employees’ State Insurance Corporation scheme rose to 38.7 percent in FY24 compared with 36.8 percent in FY19.

Experience counts more for women

The share of experienced women in the net additions rose faster than that of male counterparts.

In FY24, experienced women accounted for 38.5 percent of net additions to the EPF scheme, about 10 percentage points higher than FY19. In contrast, the share of experienced men in the workforce went up marginally to 44.2 percent from 42.1 percent earlier.

“Female participation from younger group declined because more women are entering higher education,” Roy added.
The change in the share of experienced men in the workforce came at the expense of 22-26-year-olds, as the share of early entrants held steady at 18.1 percent during this period.