Employment: Growth, Informalisation and Other Issues

• Introduction to Employment & Work

  • Meaning of Worker: Individuals engaged in economic activity to earn a living.
  • Significance of Work: Contributes to Gross Domestic Product (GDP) and personal survival.
  • Types of Workers:
    • Self-employed: Own and operate their own enterprises (highest share in India).
    • Hired Workers: Employed by others and given wages/salaries.
      • Regular Salaried Employees: Social security benefits, permanent.
      • Casual Wage Labourers: Daily wagers, no job security, no benefits.

• Participation of People in Employment (Labour Supply)

  • Worker-Population Ratio (WPR): Percentage of total population actively participating in economic activity.
    • Used to analyze employment levels in a country.
  • Gender and Regional Disparities:
    • Male vs. Female: Higher participation rate for men; lower for women due to domestic duties and underreporting.
    • Urban vs. Rural: Higher WPR in rural areas due to limited schooling and necessity of agricultural work.

• Growth and Changing Structure of Employment

  • Sectoral Distribution of Employment:
    • Primary Sector: Agriculture, forestry, fishing (traditionally highest, but declining).
    • Secondary Sector: Manufacturing, mining, construction (steady growth).
    • Tertiary Sector: Trade, transport, services (growing rapidly).
  • Jobless Growth: A situation where GDP grows at a higher rate than the employment growth rate (a major concern in India).

• Informalisation of Indian Workforce

  • Formal Sector: Enterprises with 10 or more workers, regular pay, union rights, social security benefits.
  • Informal Sector: Enterprises with less than 10 workers, highly vulnerable, lack of job security and benefits.
  • Informalisation: Shift of the workforce from the formal to the informal sector over time.
    • Majority of Indian workers are now informal workers.

• Unemployment

  • Definition: Able and willing people unable to find jobs at the prevailing wage rate.
  • Types of Unemployment in India:
    • Disguised Unemployment: Marginal productivity of labor is zero (common in agriculture).
    • Seasonal Unemployment: Unemployed during certain months of the year (agricultural off-season).
    • Open Unemployment: People willing and able to work but completely without jobs.

• Government Intervention & Employment Generation

  • Role of State: Direct and indirect employment generation.
  • Major Initiatives/Schemes:
    • MGNREGS (Mahatma Gandhi National Rural Employment Guarantee Act): Guarantees 100 days of wage employment.
    • Skill development programs and self-employment promotion.