Micro and small enterprises have emerged as the primary contributors to formal job creation under the Employees’ State Insurance Corporation (ESIC) in India.
Between April 2024 and February 2025, ESIC recorded 20.9 million new registrations, with the majority coming from businesses employing up to 20 workers.
This surge is attributed to expanded coverage, improved services, and the integration of ESIC benefits with Ayushman Bharat, making the scheme more attractive to workers.
Growth in ESIC Registrations
The latest payroll data indicates that new registrations averaged 1.9 million per month in FY25, with projections suggesting the total could reach 22.8 million by the end of the fiscal year.
This marks a significant increase compared to 22.1 million registrations in FY24, highlighting the growing formalization of employment in India.
A senior government official noted that the rise in ESIC enrollments is largely due to rapid expansion into newer districts and enhanced service offerings, prompting more companies and workers to join the scheme.
The data, however, does not account for employees who exited the formal job market or switched jobs.
Role of Micro and Small Enterprises in ESIC Growth
Micro and small enterprises, particularly those with up to 250 workers, have played a crucial role in driving ESIC registrations.
These businesses, spanning manufacturing and services sectors, tend to hire in bulk due to lower wage structures, thereby contributing significantly to formal employment numbers.
The convergence of ESIC with Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) has further incentivized workers to enroll.
This integration provides secondary and tertiary medical services to over 140 million ESIC beneficiaries at 30,000 AB-PMJAY-empaneled hospitals, making the scheme more appealing.
Implications for Employment and Social Security
The surge in ESIC registrations reflects a broader trend of increasing formal employment in India.
By bringing more workers under social security coverage, the scheme ensures access to medical benefits, unemployment cash assistance, maternity benefits, and disability compensation.
This expansion is expected to improve job security and financial stability for millions of workers.
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