Employment Linked Incentive Scheme 2025 (ELI Scheme) has been approved by the Union Cabinet on July 1, 2025 approved with an allocation of ₹99,446 crore. This scheme is aimed at supporting job creation and enhancing social security in India, especially within the manufacturing sector. The ELI Scheme seeks to create over 3.5 crore jobs between August 2025 and July 2027. Read on to learn in detail about the Employment Linked Incentive Scheme!
The Employment Linked Incentive Scheme 2025 is a government initiative to boost formal job creation in India. Launched under the Union Budget 2024–25, the scheme offers financial incentives to both first-time employees and employers. The ELI scheme will run from August 1, 2025, to July 31, 2027, with the aim of generating 3.5 crore new jobs, particularly in the manufacturing sector.
ELI Scheme 2025 Overview | |
Approval Date | July 1, 2025 |
Implementation | August 1, 2025 to July 31, 2027 |
Objectives | Boost formal job creation, support youth employment, promote social security, and encourage retention |
Total Budget Outlay | ₹99,446 crore |
Target | Over 3.5 crore jobs in two years |
Focus Sector | All sectors, with special emphasis on manufacturing |
Scheme Structure | Two parts: Part A (First-time Employees), Part B (Employers) |
Payment Mechanism | Direct Benefit Transfer (DBT):
|
Expected Beneficiaries | 1.92 crore first-time employees (Part A), 2.6 crore new jobs via employer incentives (Part B) |
The scheme has two main parts, each focusing on a different group: first-time employees and their employers.
This part is designed for people who are joining the formal workforce for the first time. It applies to those registered under EPFO and earning up to ₹1 lakh per month. Eligible employees will receive up to ₹15,000 in two payments.
First payment after six months of continuous work.
Second payment after twelve months, once a short financial training course is completed.
A part of this incentive will be saved in a secure financial instrument to help young people develop better money habits. Around 1.92 crore young individuals are expected to benefit directly.
Employers will also receive a monthly incentive for each new eligible employee they hire and retain.
₹1,000 for workers earning up to ₹10,000/month
₹2,000 for those earning between ₹10,001 and ₹20,000/month
₹3,000 for workers earning between ₹20,001 and ₹1 lakh/month
To qualify, employers must hire at least two new employees if they have fewer than 50 workers, or five new employees if they have 50 or more. These workers must stay on the payroll for a minimum of six months.
For companies in the manufacturing sector, the incentive period is extended to four years, giving a long-term boost to industries. Payments will be made via DBT to ensure transparency and minimize misuse
Here is how to apply for the Employment-Linked Incentive scheme:
Go to the official EPFO portal: www.epfindia.gov.in
On the homepage, click on ‘Apply Online’ under ‘Online Services’.
Enter your personal and job-related details in the application form.
Get your Universal Account Number (UAN) from your employer. Activate it by clicking ‘Activate UAN’ under ‘Important Links’ on the EPFO site.
Make sure your Aadhaar is linked to your UAN, and your bank details are updated.
Employers must keep the new hires for at least six months. If this condition is met, incentives will be released.
For employees: Take the mandatory online Financial Literacy course before claiming the second instalment.
The government will directly credit the incentive to the employees’ and employers’ accounts using Aadhaar-verified bank details.
The entire process is tracked digitally to verify job creation and prevent misuse of funds.
The ELI Scheme 2025 brings several benefits to the Indian economy:
Promotes Youth Employment: The scheme directly supports young people who are starting their careers.
Supports Business Growth: Employers get financial help for hiring more workers. This makes it easier for them to expand and grow.
Encourages Formal Jobs: All jobs under this scheme are formal, with EPFO coverage. This means better job security and social benefits for workers.
Improves Financial Awareness: The required financial training teaches new employees how to save, invest, and plan their spending.
Boosts Manufacturing: By extending the incentive to four years in manufacturing, the scheme strengthens this core sector of the economy.
Large-Scale Job Creation: With a target of 3.5 crore new jobs, this scheme can have a significant impact on reducing unemployment across India.
To sum up, the Employment Linked Incentive Scheme 2025 is a powerful move toward job creation and formal employment. It supports both workers and employers in practical ways. If implemented well, it can bring major positive changes to India’s labour market.
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