/34K startups gave direct employment to 4.2L: Government data

34K startups gave direct employment to 4.2L: Government data

(This story originally appeared in on Sep 20, 2020)

BENGALURU: Emerging as a major job creator, more than 34,000 startups, as of September 2020, gave direct employment of over 4.2 lakh people.

According to data released by the ministry of commerce and industry, the department for promotion of industry and internal trade (DPIIT) has so far recognised 36,106 startups, of which 34,267 have self-reported employment data. The 4.2 lakh count is a significant increase from the 1.9 lakh such jobs startups created in 2016. At that time, DPIIT had listed only 16,105 recognised startups.

Guruprasad Mohapatra, secretary, DPIIT, told TOI, “The figures have been provided by startups registered with us. The registration enables them to avail some direct and indirect tax benefits. It also helps them gain access to other departments and ministries of the central government. But yes, not all startups register with us.”

While the present dataset did not give a sector-wise break-up, past trends show that a majority of these jobs are likely to be in the Information Technology services sector, followed by healthcare and life sciences, education and food and beverages. A DPIIT document released in November 2019 shows that of the 24,948 registered firms, 3,443 were involved with IT services, 2,063 were in healthcare and life sciences, and 1,766 and 1,009 were from the other two categories.

The latest data trend shows that 36% of the jobs were created in Maharashtra and Karnataka, which are also states that have the most number of startups, followed by Delhi.

V Balakrishnan, chairman, Exfinity Ventures, a venture capitalist firm that invests in startups, said, “The overall number is positive, but new employment is happening only in patches. The startup job environment is not so bad, but it is not as good as last year as firms are more concerned about fundraising and business management.”

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