GROWTH & CHANGING STRUCTURE OF EMPLOYMENT

Changing Structure of Employment

• A major section of our population lives in rural areas and is dependent on agriculture as their main livelihood.
• The developmental strategies in many countries, including India, have always aimed at reducing the proportion of people depending on agriculture.
• Following is the effect on different sections of workforce, due to growth pattern of employment and GDP:

• In 1972-73, 74.3% of workforce was in 2011-12. It shows a substantial decline to 48.9% in 2011-12. It shows a substantial shift from farm work to non-farm work.
• Secondary and service sectors are showing promising, as shares of these sectors have increased from 10.9% to 24.37 respectively.

Casualization of Workforce

• Over the last three decades (1972-2012), there has been considerable. In addition, regular salaried employed to casual wage work.
• The process of moving from self-employment and regular salaried employment to casual wage work is known as casualization of workforce.

• Self-Employment: Although, it continues to be the major employment provider, its share declined from 61.4% in 1972-73 to 52% in 2011-12.

• Regular Salaried Employees: Its share has stagnated at around 14%. There is a marginal increase from 15.4% in 1972-73 to 18% in 2011-12.
• Casual Workers: Their share has increased from 23.2% in 1972-73 to 30% in 2011-12.

INFORMALISATION OF THE INDIAN WORKFORCE

• Even after 55 years of planned development, three-fifth of Indian depends on agriculture as the major source of livelihood.

• Over the years, the quality of employment has also deteriorated. Even others do not get maternity benefit, provident fund, gratuity more than 10-20 years, some workers do not get maternity benefit or and pension.

• Employees in the private sector get a lower salary as compared to employees doing the same work in the public sector.

• The employment structure in India can be studied with respect to two kinds of sectors. (I) Formal or Organised Sector; (ii) Informal or Unorganised Sector.

Formal or Organised Sector

• All the public enterprises and private establishments, employ 10 or more hired workers. are called formal sector establishments.
• Workers who work in such establishments are known as formal sector workers.
• Formal workers enjoy social security benefits and earn more than those in the informal sector earn.
• The government protects them in various ways through its labor laws and they can form 'Trade Unions' to protect their interests.
• However, the organized sector provides work to just 7% of the total work force.

Informal or Unorganised Sector

• Informal sector includes all those private enterprises, which hire less than 10 workers.
• Workers who work in such enterprises are known as informal sector workers. For example, farmers, agricultural laborers, owners of small enterprises, etc.
• It also includes all non-farm casual wage laborers who work for more than one employer such as construction workers and headload workers.
• In India, over 90% of employment is found in the unorganized sector, viz., small farms, household industries, shops and other self-employment units.
• In the informal sector, male workers account for 69% of the workforce.
• Workers and enterprises in the informal sector do not get regular income. They do not have any protection or regulation from the government. Such workers have the risk of being dismissed without any compensation.
• Workers of this sector live in slums and are squatters (persons who unlawfully occupy an uninhabited building or unused land).
• Informal sector uses outdated technology and does not maintain any accounts.

Distribution of Workforce in Formal and Informal Sectors

As the economy grows, more and more workers should become formal sector workers and the proportion of workers engaged in the informal sector should decrease.

Formal Vs Informal:

• Out of a total of 473 million workers in the country.
• 30 million workers are in the formal sector and the remaining 443 mills in the informal sector.
• It means, only 6% of people are employed in the formal sector and the rest in the informal sector.

Male Vs Female

• In the formal sector, out of 30 million workers, 24 million (80%) are male workers and only 6 million (20%) are women.
• In the informal sector, out of 443 million workers, male workers account for 306 million (69%) and the remaining 137 million (31%) are women.

Realizing the Importance of the Informal Sector

Due to the failure of the formal sector in generating employment, India started paying attention to enterprises and workers in the informal sector. With the efforts of the International Labour Organisation (ILO), the Indian government has initiated the modernization of informal sector enterprises and the provision of social security measures to informal sector workers.