When Policy Meets Practice: Why I Want Employers to Embrace the Jobs Incentive Scheme

I have been thinking a lot about the space where public policy and private enterprise meet. When a government designs an incentive that lowers the cost and risk of hiring, it is not only moving numbers on a ledger — it is nudging a social contract. Recently, Labour Minister Dr. Mansukh Mandaviya urged employers to make use of the new jobs incentive programme — the Pradhan Mantri Viksit Bharat Rozgar Yojana / Employment‑Linked Incentive (ELI) — and I find his plea worth pausing over.Pradhan Mantri Viksit Bharat Rozgar Yojana aims to empower youth ELI scheme to boost job creation, social security, says official India’s Path to a Skilled, Inclusive and Tech-Driven Workforce

What the scheme is trying to do — in plain terms

The headline figures are striking: a large‑scale scheme with an outlay running into lakhs of crores that seeks to catalyse millions of formal jobs and to put first‑time entrants under social security from day one. For example, the scheme’s architecture includes direct transfers to first‑time employees and ongoing employer incentives meant to reduce the cost of sustained hiring — a design that marries immediate relief with the hope of durable formalisation.Pradhan Mantri Viksit Bharat Rozgar Yojana aims to empower youth ELI scheme to boost job creation, social security, says official

Numbers alone do not make policy. The real test is whether employers — the ultimate implementers — treat these incentives as an operational lever or merely as a box to tick. Dr. Mandaviya’s public nudge to employers is, in that sense, both a practical reminder and an ethical appeal: policy is only as useful as the actions it enables on the ground.Pradhan Mantri Viksit Bharat Rozgar Yojana aims to empower youth

Why employers should care beyond the subsidy

I want to lay out three lenses through which I look at this moment — and why employers should choose to act.

• Long view of human capital: Hiring someone and integrating them into social security is an investment in stability. When a worker’s first formal job comes with social protection and a pathway to upskilling, retention improves and productivity follows.

• Operational leverage: The scheme reduces the marginal cost of hiring and experimenting with new roles. That lowers the bar for firms to try productive innovations — new assembly lines, new services, pilot projects — without taking the full burden of upfront wage risk.

• Shared legitimacy: There is a broader, intangible but real return when businesses participate in societal solutions. Firms that convert incentives into meaningful permanent opportunities win trust among communities, regulators and, importantly, future talent.

These points are not abstract. They were echoed in conversations at industry‑government fora earlier this year, where skilling, formalisation and employer engagement came to the fore as complementary pieces of the same mosaic.India’s Path to a Skilled, Inclusive and Tech-Driven Workforce

The practical calculus: how employers can think about it

If I were running a medium‑sized enterprise today, the questions I would ask are practical:

• Which job profiles are genuinely incremental — roles that we would not have hired without help? Those are the hires the scheme is designed for.

• How can we pair recruitment with a short, intensive on‑boarding and skills ladder so that the DBT (direct benefit transfer) and incentive help seed capability rather than subsidise churn?

• Which parts of our cost structure can be reimagined if incentive support reduces early‑stage wage burden — can we test a new product line, extend hours, or pilot localisation of inputs?

When companies answer these honestly, incentives stop being a temporary crutch and become a lever to scale experiments and absorb first‑timers into meaningful careers.

A note on implementation and governance

No grand scheme survives contact with reality without clean, simple operational mechanics: transparent DBT flows, clear EPFO/ESI integration, and user‑friendly registration for establishments. The government has designed delivery channels with these concerns in mind, but the burden of success sits with both sides. Firms must register correctly, maintain records, and design on‑the‑job training; administrators must ensure speed and predictability. The more friction we remove, the more likely outcomes will match the promise.ELI scheme to boost job creation, social security, says official

A broader reflection: policy as civilisation work

There is a modest, philosophical point I keep returning to. Policy is an instrument of civilisation; it channels collective choices into institutions that outlast individuals. When we design incentives to formalise employment, we are not simply adjusting microeconomic parameters — we are choosing the kind of society we want. Do we want fleeting, precarious labour markets, or networks of opportunity that allow a young person to enter the formal economy with dignity and prospect? The answer should guide corporate ambition as much as it guides public policy.

Dr. Mandaviya’s appeal to employers is, therefore, a civic moment as much as an economic one. It asks private actors to convert a fiscal nudge into generational mobility.Pradhan Mantri Viksit Bharat Rozgar Yojana aims to empower youth India’s Path to a Skilled, Inclusive and Tech-Driven Workforce

In closing — a small, stubborn hope

I am a believer in business as a generative force. When companies choose to hire with intention, when they pair financial incentives with clear on‑ramp training and social protection, something simple and profound happens: economic dynamism meets social confidence. I hope employers see this scheme as more than a ledger entry. See it instead as an opportunity to invest in people, to test new ideas with less risk, and to anchor growth in a more resilient, equitable workforce.

If policy is the tide, employers are the ships. Let us not watch the tide rise from the shore.

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Regards,
Hemen Parekh