On August 1, 2026, the Pradhan Mantri Viksit Bharat Rojgar Yojana (PM-VBRY) completed its first year of implementation across India. Announced in August 2025 by the Ministry of Labour and Employment with a financial outlay of ₹99,446 crore for the period from August 1, 2025, to July 31, 2027, the scheme aims to create over 3.5 crore jobs. It provides wage incentives to first-time employees and hiring subsidies to employers via the Employees' Provident Fund Organisation (EPFO). This milestone highlights progress in workforce formalisation, female labour force participation, and digital governance.
On August 1, 2026, the Government of India marked the completion of one year of implementation of the Pradhan Mantri Viksit Bharat Rojgar Yojana (PM-VBRY). Launched in August 2025 as a major employment-linked incentive (ELI) initiative, the scheme targets formal job creation with a dedicated budget of ₹99,446 crore. Within its first 12 months, the scheme successfully brought over 72 lakh first-time workers into the formal economy under the EPFO framework.
The scheme was launched in August 2025 and runs from August 1, 2025, to July 31, 2027. It is implemented nationwide across all States and Union Territories of India, covering both industrial hubs and rural manufacturing units.
1. EPFO Registration: An employer registers a new employee earning up to ₹1,00,000 per month and generates a Universal Account Number (UAN).
2. Digital Verification: The employee validates identity using Aadhaar-based Face Authentication Technology on the UMANG App.
3. Part A Employee Benefit: First-time workers receive up to ₹15,000 (one month's wage) transferred in two instalments (after 6 and 12 months), with mandatory financial literacy completion before the second payout.
4. Part B Employer Support: Employers receive up to ₹3,000 per month per additional employee for 2 years (extended to 4 years for manufacturing) via Direct Benefit Transfer (DBT).
India's informal employment accounts for over 85% of its workforce, which is significantly higher than the OECD average of under 15%. PM-VBRY aligns with the International Labour Organization (ILO) Recommendation No. 204 concerning the transition from the informal to the formal economy.
Core Concept: Formalisation of Employment and Social Security
Q1. What is the total financial outlay allocated for the Pradhan Mantri Viksit Bharat Rojgar Yojana (PM-VBRY)? [Easy]
A) ₹50,000 crore
B) ₹75,000 crore
C) ₹99,446 crore
D) ₹1,20,000 crore
Answer: C
Explanation: The PM-VBRY has been allocated a total financial outlay of ₹99,446 crore for its two-year implementation period.
Q2. Which nodal organisation administers the Pradhan Mantri Viksit Bharat Rojgar Yojana? [Easy]
A) NITI Aayog
B) Employees' Provident Fund Organisation (EPFO)
C) National Skill Development Corporation (NSDC)
D) Pension Fund Regulatory and Development Authority (PFRDA)
Answer: B
Explanation: The scheme is implemented through a transparent framework administered by the Employees' Provident Fund Organisation (EPFO) under the Ministry of Labour and Employment.
Q3. Under Part A of PM-VBRY, what is the maximum monthly salary threshold for a first-time employee to be eligible for incentives? [Moderate]
A) ₹25,000
B) ₹50,000
C) ₹75,000
D) ₹1,00,000
Answer: D
Explanation: First-time employees earning up to ₹1,00,000 per month are eligible to receive incentives under Part A of the scheme.
Q4. What prerequisite must a first-time employee complete before receiving the second instalment under Part A of PM-VBRY? [Moderate]
A) Skill certification course
B) Financial literacy programme
C) Higher secondary education
D) E-Shram portal registration
Answer: B
Explanation: The second instalment is disbursed after 12 months of continuous service following the completion of a mandatory financial literacy programme.
Q5. How many years of employer incentive support is provided under Part B of PM-VBRY for units operating specifically in the manufacturing sector? [Moderate]
A) 2 years
B) 3 years
C) 4 years
D) 5 years
Answer: C
Explanation: While general sector employers receive incentive support for 2 years, manufacturing sector employers receive support extended to the 3rd and 4th years.
Q6. Statement I: Under PM-VBRY Part A, the maximum one-time incentive for a first-time employee is capped at ₹15,000.
Statement II: The entire incentive under Part A is disbursed immediately upon EPFO registration. [Tricky]
A) Both Statement I and Statement II are correct
B) Statement I is correct but Statement II is incorrect
C) Statement I is incorrect but Statement II is correct
D) Neither Statement I nor Statement II is correct
Answer: B
Explanation: Statement I is correct as the incentive is capped at ₹15,000, but Statement II is incorrect because it is disbursed in two instalments (after 6 and 12 months), not immediately.
Q7. An employer claims PM-VBRY Part B benefits for additional employees. What is the minimum retention period required for an employee before the employer becomes eligible for subsidy payouts? [Tricky]
A) 3 months
B) 6 months
C) 9 months
D) 12 months
Answer: B
Explanation: Employers receive incentives for every eligible additional employee who is retained for at least 6 months.
Q8. Which digital mechanism is mandatory for UAN authentication prior to incentive disbursement under PM-VBRY? [Tricky]
A) Iris scan via DigiLocker
B) Face Authentication Technology on UMANG App
C) SMS OTP on DigiDaksh portal
D) Bank branch physical verification
Answer: B
Explanation: PM-VBRY requires UAN authentication using Face Authentication Technology specifically on the UMANG App before incentives are released.
PYQ 1:
With reference to the Pradhan Mantri Viksit Bharat Rojgar Yojana (PM-VBRY), consider the target demographic:
A) It focuses exclusively on gig workers in urban delivery sectors
B) It provides wage incentives for first-time employees and hiring support to employers in the formal sector
C) It replaces all existing state-level unemployment allowance schemes
D) It is restricted solely to public sector undertakings (PSUs)
Answer: B
Explanation: PM-VBRY is a dual-component scheme encouraging first-time employment and supporting employers across formal private and manufacturing sectors through EPFO.
PYQ 2:
Consider the following statements regarding PM-VBRY:
1. Part A provides a one-time incentive equal to one month's EPF wage capped at ₹15,000 for first-time employees.
2. Part B incentivises employers up to ₹3,000 per month for two years for each additional worker retained for at least six months.
3. The scheme is executed over a five-year period from 2025 to 2030.
Which of the above statements are correct?
A) 1 and 2 only
B) 2 and 3 only
C) 1 and 3 only
D) 1, 2 and 3
Answer: A
Explanation: Statements 1 and 2 are correct. Statement 3 is incorrect because the scheme period is two years (August 1, 2025 to July 31, 2027), not five years.
PYQ 3:
Match List I (Scheme Element) with List II (Provision Value):
List I:
a) Total financial outlay b) Maximum employee wage cap for eligibility c) Maximum monthly employer incentive per worker d) Minimum service period for 1st instalment
List II:
1. ₹1,00,000 per month
2. ₹99,446 crore
3. 6 months
4. ₹3,000
Select the correct code:
A) a-2, b-1, c-4, d-3
B) a-1, b-2, c-3, d-4
C) a-2, b-4, c-1, d-3
D) a-4, b-1, c-2, d-3
Answer: A
Explanation: Outlay is ₹99,446 crore (a-2), wage cap is ₹1,00,000 (b-1), employer incentive is ₹3,000 (c-4), and minimum service period is 6 months (d-3).
Question 1 (150 words): Discuss how the Pradhan Mantri Viksit Bharat Rojgar Yojana (PM-VBRY) addresses the dual challenges of informal employment and job creation in India.
The Pradhan Mantri Viksit Bharat Rojgar Yojana (PM-VBRY) serves as a strategic intervention to bridge India's persistent informal-formal labour divide. By committing ₹99,446 crore between August 2025 and July 2027, the scheme targets generating 3.5 crore jobs, including 1.92 crore first-time formal workers.
First, PM-VBRY incentivises workers directly through Part A by offering a wage subsidy up to ₹15,000, encouraging youth to register under the EPFO framework. Second, Part B lowers hiring costs for businesses by providing up to ₹3,000 monthly support per additional employee for up to two years, with extended four-year benefits for labour-intensive manufacturing. In its first year, over 72 lakh first-time workers joined the formal pool, with women comprising nearly 30%.
To sustain this momentum, integrating real-time skill alignment with EPFO data and ensuring smooth compliance under the Code on Social Security will be critical way forward.
Question 2 (250 words): Evaluate the role of employment-linked incentive schemes like PM-VBRY in reaping India's demographic dividend while enhancing social security coverage.
India's large working-age population represents a vital demographic window that requires rapid creation of formal, quality jobs. The launch of PM-VBRY with an outlay of ₹99,446 crore marks a shift toward demand-side fiscal stimulus aimed at formalising the workforce.
Historically, employment schemes faced challenges regarding worker retention and administrative leakage. PM-VBRY addresses these issues through robust digital architecture, mandating Face Authentication on the UMANG App, UAN integration, and direct benefit transfers (DBT). By tying employer subsidies to a mandatory six-month retention period, the scheme ensures employment stability rather than temporary headcount inflation. Furthermore, mandating financial literacy training prior to releasing the second wage instalment enhances long-term financial inclusion for new entrants.
From a social security perspective, PM-VBRY aligns with Directive Principles under Article 41 and Article 43 of the Constitution. By enrolling first-time jobseekers into EPFO, workers gain access to provident funds, insurance, and pensions. Special provisions extending employer support to four years in manufacturing directly complement the National Manufacturing Mission, driving industrial job generation.
However, challenges remain in extending similar formal protections to gig workers and unorganised agriculture. Moving forward, harmonising PM-VBRY with the Labour Codes and expanding e-Shram integration will ensure India translates its demographic advantage into sustainable, inclusive growth.