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The Union Cabinet on Tuesday cleared the Employment Linked Incentive (ELI) Scheme, a major employment-generation initiative announced in the Union Budget 2024–25. With an outlay of ₹99,446 crore, the scheme aims to create over 35 million jobs across sectors between August 2025 and July 2027, with a strong thrust on the manufacturing industry.
The ELI scheme is designed to boost job creation, enhance employability, and expand social security coverage. As per the official statement, nearly 19 million of the expected beneficiaries will be first-time employees entering the formal workforce.
Under the scheme, newly hired employees will receive financial support of up to one month’s EPF wage, capped at ₹15,000, disbursed in two instalments. “The first instalment will be payable after 6 months of service and the second instalment will be payable after 12 months of service and completion of a financial literacy programme by the employee,” the Centre stated.
Employer Incentives
To further encourage job creation, the scheme also offers incentives to employers who increase their workforce. Companies with fewer than 50 employees must hire at least two additional workers, while those with 50 or more employees must hire at least five to qualify. These employees must remain on payroll for a minimum of six months.
Incentives for employers will range between ₹1,000 and ₹3,000 per month per new hire, based on the employee’s EPF wage. While all sectors are eligible for these benefits for two years, the manufacturing sector will enjoy the support for four years. According to government estimates, this provision alone is expected to contribute to the creation of approximately 26 million jobs.
The government underscored the broader impact of the initiative, noting, “An important outcome of the Scheme will also be formalisation of the country’s workforce by extending social security coverage for crores of young men and women.”
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