6

EMPLOYMENT : GROWTH,
INFORMALISATION
AND OTHER ISSUES

After studying this chapter, the learners will

• understand a few basic concepts relating to employment such as

economic activity, worker, workforce and unemployment
• understand the nature of participation of men and women in various
economic activities in various sectors
• know the nature and extent of unemployment
• assess the initiatives taken by the government in generating employment
opportunities in various sectors and regions.

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 What I object to, is the ‘craze’ for machinery, not machinery as such. The
craze is for what they call labour-saving machinery. Men go on ‘saving labour’
till thousands are without work and thrown on the open streets to die of
starvation...
Mahatma Gandhi

6.1 INTRODUCTION
People do a variety of work. Some
work on farms, in factories, banks,
shops and many other
workplaces; yet a few others work
at home. Work at home includes
not only traditional work like
weaving, lace making or variety of
handicrafts but also modern jobs
like programming work in the IT
industry. Earlier factory work
meant working in factories located
in cities whereas now technology
has enabled people to produce Fig. 6.1 Multinational companies sell footballs
made in the houses of Jalandhar, Punjab
those factory-based goods at
home in villages. During Covid-19
pandemic in 2020–21, millions of for ourselves; we also have a sense of
workers delivered their products and accomplishment when we work to meet
services through work-from-home. the requirements of those who are
Why do people work? Work plays dependent on us. Having recognised
an important role in our lives as the importance of work, Mahatma
individuals and as members of society. Gandhi insisted upon education and
People work for ‘earning’ a living. Some training through a variety of works
people get, or have, money by inheriting including craft.
it, not working for it. This does not Studying about working people
completely satisfy anybody. Being gives us insights into the quality and
employed in work gives us a sense of nature of employment in a country and
self-worth and enables us to relate helps in understanding and planning
ourselves meaningfully with others. our human resources. It helps us to
Every working person is actively analyse the contribution made by
contributing to national income and different industries and sectors towards
hence, the development of the country national income. It also helps us to
by engaging in various economic address many social issues such as
activities — that is the real meaning of exploitation of marginalised sections of
‘earning’ a living. We do not work only the society, child labour, etc.

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6.2 WORKERS AND EMPLOYMENT The nature of employment in India
is multifaceted. Some get employment
What is employment? Who is a worker?
throughout the year; some others get
When a farmer works on fields, he or
employed for only a few months in a
she produces food grains and raw
year. Many workers do not get fair
materials for industries. Cotton
wages for their work. While estimating
becomes cloth in textile mills and in
the number of workers, all those who
powerlooms. Lorries transport goods
are engaged in economic activities are
from one place to another. We know
included as employed. You might be
that the total money value of all such
interested in knowing the number of
final goods and services produced in a
people actively engaged in various
country in a year is called its gross
economic activities. During 2017-18,
domestic product for that year. When
India had about a 471 million strong
we also consider what we pay for our
workforce. Since majority of our people
imports and get from our exports we
reside in rural areas, the proportion of
find that there is a net earning for the
workforce residing there is higher. The
country which may be positive (if we
have exported more in value terms than
imported) or negative (if imports Work This Out
exceeded exports in value terms) or zero
(if exports and imports were of the same Ø In your house or
value). When we add this earning (plus neighbourhood, you might
or minus) from foreign transactions, come across many women
who, even though they
what we get is called the country’s gross
have technical degrees
national product for that year.
and diplomas and also free
Those activities which contribute to time to go to work, do not
the gross national product are called go to work. Ask them the
economic activities. All those who are reasons for not going to
engaged in economic activities, in work. List all of them and
whatever capacity — high or low, are discuss in the classroom
workers. Even if some of them whether they should go for
temporarily abstain from work due to work and why, and also
illness, injury or other physical ways by which they could
be sent for work. Some
disability, bad weather, festivals, social
social scientists argue that
or religious functions, they are also housewives working at
workers. Workers also include all those home without getting paid
who help the main workers in these for that work must also be
activities. We generally think of only regarded as contributing to
those who are paid by an employer for the gross national product
their work as workers. This is not so. and therefore, as engaged
Those who are self-employed are also in an economic activity.
workers. Would you agree?

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rural workers constitute about two- a particular point of time. If you want
thirds of this 471 million. Men form to know the worker-population ratio
the majority of workforce in India. for India, divide the total number of
About 77 per cent of the workers are workers in India by the population in
men and the rest are women (men and India and multiply it by 100, you will
women include child labourers in get the worker-population ratio for
respective sexes). Women workers India.
account for one-fourth of the rural If you look at Table 6.1, it shows
workforce whereas in urban areas, the different levels of participation of
they are just one-fifth of the people in economic activities. For
workforce. Women carry out works every 100 persons, about 35 (by
like cooking, fetching water and rounding off 34.7) are workers in
fuelwood and participate in farm India. In urban areas, the proportion
labour. They are not paid wages in is about 34, whereas in rural India, the
cash or in the form of grains; at times ratio is about 35. Why is there such a
they are not paid at all. For this difference? People in rural areas have
reason, these women are not limited resources to earn a higher
categorised as workers. Economists income and participate more in the
argue that these women should also employment market. Many do not go
be called workers. What do you think? to schools, colleges and other training
institutions. Even if some go, they
6.3 P ARTICIPATION OF P EOPLE IN discontinue in the middle to join the
E MPLOYMENT workforce; whereas, in urban areas, a
considerable section is able to study in
Worker-population ratio is an indicator various educational institutions. Urban
which is used for analysing the people have a variety of employment
employment situation in the country. opportunities. They look for the
This ratio is useful in knowing the appropriate job to suit their
proportion of population that is qualifications and skills. In rural areas,
actively contributing to the production people cannot stay at home as their
of goods and services of a country. If economic condition may not allow them
the ratio is higher, it means that the to do so.
engagement of people is greater; if the TABLE 6.1
ratio for a country is medium, or low,
Worker-Population Ratio in India,
it means that a very high proportion
2017-2018
of its population is not involved
directly in economic activities. Sex Worker-Population Ratio
You might have already studied, Total Rural Urban
in lower classes, the meaning of the Men 52.1 51.7 53.0
term ‘population’. Population is Women 16.5 17.5 14.2
defined as the total number of people Total 34.7 35.0 33.9
who reside in a particular locality at

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 tion of work leads to non-recognition
Work These Out of women’s work and, therefore, to the
underestimation of the number of
Ø Any study of employment women workers in the country. Think
must start with a review of the women actively engaged in many
of the worker -population activities within the house and at
ratios — why?
family farms who are not paid for such
Ø In some communities, you work. As they certainly contribute to
might have noticed that the maintenance of the household and
even if the males do not farms, do you think that their number
earn a high income, they do should be added to the number of
not send women to work. women workers?
Why?
6.4 S E L F - E M P L O Y E D AND HIRED
Compared to females, more males
WORKERS
are found to be working. The
difference in participation rates is very Does the worker-population ratio say
large in urban areas: for every 100 anything about workers’ status in
urban females, only about 14 are society or about the working
engaged in some economic activities. conditions? By knowing the status
In rural areas, for every 100 rural with which a worker is placed in an
women about 18 participate in the enterprise, it may be possible to know
employment market. Why are women, one dimension — quality of
in general, and urban women, in employment in a country. It also
particular, not
working? It is
common to find that
where men are able
to earn high
incomes, families
discourage female
members from
taking up jobs.
Going back to
what has already
been mentioned
above, many
household activities
done by women are
not recognised as
productive work.
This narrow defini- Fig. 6.2 Brick-making: a form of casual work

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 workforce. Such
Chart 6.1 : Distribution of Employment labourers are casually
engaged in others’ farms
and, in return, get a
Male Workers Female Workers remuneration for the
work done. Workers like
24% 27% 52% the civil engineer
52% working in the
construction company
24%
21% account for 23 per cent
of India’s workforce.
When a worker is
Self-employed Regular Salaried Employees
engaged by someone or
an enterprise and paid
Casual Wage Labourers his or her wages on a
regular basis, they are
enables us to know the attachment a known as regular
worker has with his or her job and salaried employees (see table 6.3).
the authority she or he has over the Look at Chart 6.1 you will notice
enterprise and over other co-workers. that self-employment is a major source
Let us take three workers from the of livelihood for both men and women
construction industry — a cement as this category accounts for more
shop owner, a construction worker and than 50 per cent of the workforce.
a civil engineer of a construction Casual wage work is the second major
company. Since the status of each one source for both men and women,
of them is different from
another, they are also Chart 6.2 : Distribution of Employment by Region
called differently. Workers
who own and operate an Urban Workers Rural Workers
enterprise to earn their 38% 15%
58% 29%
livelihood are known as
self-employed. Thus the
cement shop owner is
self-employed. About 52
per cent workforce in 13%
India belongs to this 47%
category. The construction
Casual Wage Labourers Regular Salaried Employees
workers are known as
casual wage labourers;
Self-employed
they account for about
25 per cent of India’s

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a little more so for the latter (24-27 urban areas. In the latter, both self-
per cent). When it comes to regular employment and regular wage salaried
salaried employment, both women and jobs are greater. In the former, since
men are found to be so engaged in majority of those depending on farming
greater proportion. Men form 23 per own plots of land and cultivate
cent whereas women form 21 per cent. independently, the share of self-
The gap between men and women is employed is greater.
very less. The nature of work in urban areas
When we compare the distribution is different. Obviously everyone cannot
of workforce in rural and urban areas run factories, shops and offices of
in Chart 6.2 you will notice that the self- various types. Moreover enterprises in
employed and casual wage labourers urban areas require workers on a
are found more in rural areas than in regular basis.

Work These Out

Ø We generally think that only those who are doing paid work regularly or casually
such as agricultural labourers, factory workers, those who work in banks
and other offices as assistants and clerks are workers. From the above
discussion, you must have understood that those who are self- employed such
as pavement vegetable vendors, professionals such as lawyers, doctors and
engineers are also workers. Mark (a), (b) and (c) against self-employed, regular
salaried employees and casual wage labourers respectively:
1. Owner of a saloon
2. Worker in a rice mill who is paid on daily basis but employed regularly
3. Cashier in State Bank of India
4. Typist working in a state government office on a daily wage basis but
paid monthly
5. A handloom weaver
6. Loading worker in wholesale vegetable shop
7. Owner of a cool drinks shop which sells Pepsi, Coca Cola and Mirinda
8. Nurse in a private hospital who gets monthly salary and has been work-
ing regularly for the past 5 years.
Ø Economists point out that casual wage labourers are the most vulnerable
among the three categories. Could you locate who these workers are and where
they are found and why?
Ø Can we say that the self-employed earn more than the casual wage labourers
or regular salaried employees? Identify a few other indicators of quality of
employment.

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6.5 E M P L O Y M E N T I N
FIRMS, FACTORIES
AND OFFICES

In the course of
economic development
of a country, labour
flows from agriculture
and other related
activities to industry and
services. In this process,
workers migrate from
rural to urban areas. Fig. 6.3 Garment workers: upcoming factory employment for women
Eventually, at a much
later stage, the industrial sector begins (viii) Services. For simplicity, all the
to lose its share of total employment working persons engaged in these
as the service sector enters a period of divisions can be clubbed into three
rapid expansion. This shift can be major sectors viz., (a) primary sector
understood by looking at the which includes (i) and (ii), (b) secondary
distribution of workers by industry. sector which includes (iii), (iv) and (v)
Generally, we divide all economic and (c) service sector which includes
activities into eight different industrial divisions (vi), (vii) and (viii). Table 6.2
divisions. They are (i) Agriculture (ii) shows the distribution of working
Mining and Quarrying (iii) persons in different industries during
Manufacturing (iv) Electricity, Gas and the year 2017-18.
Water Supply (v) Construction (vi) Primary sector is the main source
Trade (vii) Transport and Storage and of employment for majority of workers

TABLE 6.2
Distribution of Workforce by Industry, 2017-2018

Industrial Category Place of Residence Sex Total

Rural Urban Men Female

Primary Sector 59.8 6.6 40.7 57.1 44.6

Secondary Sector 20.4 34.3 26.5 17.7 24.4
Tertiary / Service Sector 19.8 59.1 32.8 25.2 31.0
Total 100.0 100.0 100.0 100.0 100.0

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 Work This Out

Ø All newspapers have one section meant for job opportunities. Some also
devote an entire supplement in a day or every week like Opportunities in
The Hindu or Ascent in The Times of India. Many companies advertise
vacancies for various positions. Cut those sections. Develop a table which
contains four columns: whether the company is private or public, name of
the post, number of posts, sector — primary, secondary or tertiary — and
qualification required. Analyse the table in the classroom about jobs
advertised in the newspapers.

in India. Secondary sector provides 6.6 GROWTH AND CHANGING

employment to only about 24 per cent STRUCTURE OF EMPLOYMENT
of workforce. About 31 per cent of In Chapters 2 and 3, you might have
workers are in the service sector. Table studied about the planning strategies
6.2 also shows that about 60 per cent in detail. Here we will look at two
of the workforce in rural India depends developmental indicators — growth of
on agriculture, forestry and fishing. employment and GDP. Nearly seventy
About 20 per cent of rural workers are years of planned development have
working in manufacturing industries, been aimed at expansion of the
construction and other industrial economy through increase in national
activities. Service sector provides output and employment.
employment to about 20 per cent of During the period 1950–2010,
rural workers. Agriculture is not a Gross Domestic Product (GDP) of India
major source of employment in urban grew positively and was higher than
areas where people are mainly engaged the employment growth. However,
in the service sector. About 60 per cent there was always fluctuation in the
of urban workers are in the service growth of GDP. During this period,
employment grew at the rate of not
sector. The secondary sector gives
more than 2 per cent.
employment to about one-third of
Chart 6.3 also points at another
urban workforce.
disheartening development in the late
Though both men and women 1990s: employment growth started
workers are concentrated in the declining and reached the level of
primary sector, women workers’ growth that India had in the early
concentration is very high there. About stages of planning. During these
57 per cent of the female workforce years, we also find a widening gap
is employed in the primary sector between the growth of GDP and
whereas less than half of males work employment. This means that in the
in that sector. Men get opportunities Indian economy, without generating
in both secondary and service sectors. employment, we have been able to

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produce more goods and services. Developmental strategies in many
Scholars refer to this phenomenon as countries, including India, have aimed
jobless growth. at reducing the proportion of people
So far we have seen how employment depending on agriculture.
has grown in comparison to GDP. Now it Distribution of workforce by
is necessary to know how the growth industrial sectors shows substantial
patter n of employment and GDP shift from farm work to non-farm work
affected different sections of workforce. (see Table 6.3). In 1972-73, about 74
Fr om this we will also be able to per cent of workforce was engaged in
understand what types of employment primary sector and in 2011-12, this
are generated in our country. proportion has declined to about
Let us look at two indicators that 50 per cent. Secondary and service
we have seen in the preceding sections sectors are showing promising future
— employment of people in various for the Indian workforce. You may
industries and their status. We know notice that the shares of these sectors
that India is an agrarian nation; a have increased from 11 to 24 per cent
major section of population lives in and 15 to 27 per cent, respectively.
rural areas and is dependent on The distribution of workforce in
agriculture as their main livelihood. different status indicates that over the

Chart 6.3: Growth of Employment and Gross Domestic

Product, 1951–2012 (%)

Note: *This is the period for which comparable and authentic data are available.

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 TABLE 6.3
Trends in Employment Pattern (Sector-wise and Status-wise), 1972-2018 (in %)
Item 1972-73 1983 1993-94 2011-2012 2017-2018

Sector
Primary 74.3 68.6 64 48.9 44.6
Secondary 10.9 11.5 16 24.3 24.4
Services 14.8 16.9 20 26.8 31.0
Total 100.0 100.0 100.0 100.0 100.0

Status
Self-employed 61.4 57.3 54.6 52.0 52.2
Regular Salaried Employees 15.4 13.8 13.6 18.0 22.8
Casual Wage Labourers 23.2 28.9 31.8 30.0 25.0
Total 100.0 100.0 100.0 100.0 100.0

last five decades (1972-2018), people from self-employment and regular

have moved from self-employment and salaried employment to casual wage
regular salaried employment to casual work noticed during 1972-94 as
wage work. Yet self-employment casualisation of workforce. This
continues to be the major employment makes the workers highly vulnerable.
provider. Look at the last column of How? Look at the case study of
table 6.3. How do you understand the Ahmedabad in the preceding section.
stagnation of secondary sector and In the mean time you also notice
moderate rise in self-employement in 2017-18 a moderate rise in the
during 2011-18? Discuss in the class. share of regular salaried employees.
Scholars call the process of moving How do you explain this phenomenon?

Work These Out

ØDo you know that maintaining employment growth at 2 per cent for a country like
India is not an easy thing? Why?
Ø What will happen if there is no additional employment generated in the economy
even though we are able to produce goods and services in the economy? How could
jobless growth happen?
Ø Economists say that if casualisation increases the earning of the people, such
phenomenon should be welcomed. Suppose a marginal farmer becomes a full-time
agricultural labourer, do you think he will be happy even if he earns more in his
daily wage work? Or will a permanent and regular worker of the pharmaceutical
industry be happy if he becomes a daily wage labourer, even if his or her overall
earnings increase? Discuss in the classroom.

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6.7 I N F O R M A L I S A T I O N OF INDIAN labour laws, enable them to protect their
WORKFORCE rights in various ways. This section of the
workforce forms trade unions, bargains
In the previous section we have found with employers for better wages and other
that the proportion of hired work jobs - social security measures. Who are they?
working for others has been increasing. To know this we classify workforce into
One of the objectives of development two categories: workers in formal and
planning in India, since India’s informal sectors, which are also referred
independence, has been to provide to as organised and unorganised
decent livelihood to its people. It has sectors. All the public sector
been envisaged that the industrialisation establishments and those private
strategy would bring surplus workers sector establishments which employ
from agriculture to industry with better 10 hired workers or more are called
standard of living as in developed formal sector establishments and those
countries. We have seen in the preceding who work in such establishments are
section, that even after 70 years of formal sector workers. All other
planned development, more than half enterprises and workers working in those
of the Indian workforce depends on enterprises form the informal sector.
farming as the major source of livelihood. Thus, informal sector includes millions
Economists argue that, over the of farmers, agricultural labourers,
years, the quality of employment has owners of small enterprises and people
been deteriorating. Even after working for working in those enterprises as also the
more than 10-20 years, why do some self-employed who do not have any
workers not get maternity benefit, hired workers. It also includes all non-
provident fund, gratuity and pension? farm casual wage labourers who work
Why does a person working in the for more than one employer such as
private sector get a lower salary as construction workers and headload
compared to another person doing the workers. You may note that this is one
same work but in the public sector? of the ways of classifying workers.
You may find that a small section of There could be other ways of
Indian workforce is getting regular classification as well. Discuss the
income. The government, through its possible ways in the class.

Box 6.1: Formal Sector Employment

The information relating to employment in the formal sector is collected by the Union
Ministry of Labour through employment exchanges located in different parts of the country.
Do you know who is the major employer in the formal sector in India? In 2012, out of
about 30 million formal sector workers, about 18 million workers were employed by the
public sector. Here also men form the majority, as women constitute only about
one-sixth of the formal sector workforce. Economists point out that the reform process
initiated in the early 1990s resulted in a decline in the number of workers employed in
the formal sector. What do you think?

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 Fig. 6.4 Road side vending: an increasing variety of informal sector employment

Those who are working in the formal the formal sectors in the country?
sector enjoy social security benefits. About only six per cent (30/473×100)!
They earn more than those in the Thus, the rest 94 per cent are in the
informal sector. Developmental informal sector. In 2011-12, the year
planning envisaged that as the economy for which gender wise data on
grows, more and more workers would formal-informal sector employment is
become formal sector workers and the available (Chart 6.4), about 20 per cent
proportion of workers engaged in the of formal sector and 30 per cent of
informal sector would dwindle. But informal sector workers are women.
what has happened in
India? Look at the
following chart which Chart 6.4: Workers in Formal and Informal
310
Sector, 2011-12
350
gives the distribution
300
Number of Workers

of workforce in formal
250
and informal sectors.
(in million)

200 24 133
We learnt that in 6
2011-12 there were 150

about 473 million 100

workers in India. 50
There were about 30 0
million workers in the
formal sector. Can you
Male Female
estimate the percentage
of people employed in

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 Box 6.2: Informalisation in Ahmedabad
Ahmedabad is a prosperous city with its wealth based on the produce of more
than 60 textile mills with a labour force of 1,50,000 workers employed in them.
These workers had, over the course of the century, acquired a certain degree
of income security. They had
secure jobs with a living
wage; they were covered by
social security schemes
protecting their health and
old age. They had a strong
trade union which not only
represented them in
disputes but also ran
activities for the welfare of
workers and their families.
In the early 1980s, textile
mills all over the country
began to close down. In some
places, such as Mumbai,
the mills closed rapidly. In
Ahmedabad, the process of Change in the balance of power in a house: an
closure was long drawn out unemployed mill worker peeling garlic whereas his wife
has a new job of beedi rolling.
and spread over 10 years.
Over this period, approximately over 80,000 permanent workers and over 50,000
non-permanent workers lost their jobs and were driven to the informal sector.
The city experienced an economic recession and public disturbances, especially
communal riots. A whole class of workers was thrown back from the middle
class into the informal sector, into poverty. There was widespread alcoholism
and suicides, children were withdrawn from school and sent to work.

Source: Renana Jhabvala, Ratna M. Sudarshan and Jeemol Unni (Ed.) Informal
Economy at Centre Stage: New Structures of Employment, Sage
Publications, New Delhi, 2003, pp.265.

Since the late 1970s, many government. Workers are dismissed

developing countries, including India, without any compensation.
started paying attention to enterprises Technology used in the informal sector
and workers in the informal sector enterprises is outdated; they also do
as employment in the formal sector not maintain any accounts. Workers
is not gr owing. Workers and of this sector live in slums and are
enterprises in the informal sector do not squatters. Of late, owing to the efforts
get regular income; they do not have of the International Labour Organisation
any protection or regulation from the (ILO), the Indian government has
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 Work These Out

Tick (ü) mark against those which are in the informal sector
Ø Worker in a hotel which has seven hired workers and three family workers
ØA private school teacher in a school which has 25 teachers
ØA police constable
Ø Nurse in a government hospital
Ø Cycle-rickshaw puller
Ø The owner of a textile shop employing nine workers
Ø Driverof a bus company which has more than 10 buses with 20 drivers,
conductors and other workers
Ø Civil engineer working in a construction company which has 10 workers
Ø Computer operator in the state government office working on a temporary
basis
ØA clerk in the electricity office.

initiated the modernisation of informal any vacancy in their factory or office.

sector enterprises and provision of Many in the rural areas do not go out
social security measures to informal and ask for a job but stay home when
sector workers. there is no work. Some go to

6.8 UNEMPLOYMENT
You might have seen
people looking for jobs in
newspapers. Some look
for a job through friends
and relatives. In many
cities, you might find
people standing in some
select areas looking for
people to employ them
for that day’s work. Some
go to factories and offices
and give their bio-data
and ask whether there is Fig. 6.5 Unemployed mill workers waiting for casual jobs

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 Employment and Training
data of Registration with
Employment Exchanges.
Though they provide
different estimates of
unemployment, they do
provide us with the
attributes of the
unemployed and the
variety of unemployment
prevailing in our country.
Do we have different types
of unemployment in our
Fig. 6.6 Sugar cane cutters: disguised unemployment is common economy? The situation
in farm works
described in the first
employment exchanges and register paragraph of this section is called open
themselves for vacancies notified through unemployment. Economists call
employment exchanges. The National unemployment prevailing in Indian farms
Statistical Office (Previously it was known as disguised unemployment. What is
as National Sample Survey Organisation) disguised unemployment? Suppose a
defines unemployment as a situation in farmer has four acres of land and he
which all those who, owing to lack of actually needs only two workers and
work, are not working but either seek himself to carry out various operations
work through employment exchanges, on his farm in a year, but if he employs
intermediaries, friends or relatives or by five workers and his family members
making applications to prospective such as his wife and children, this
employers or express their willingness situation is known as disguised
or availability for work under the unemployment. One study conducted in
prevailing condition of work and the late 1950s showed about one-third
remunerations. There are a variety of of agriculture workers in India as
ways by which an unemployed person disguisedly unemployed.
is identified. Economists define You may have noticed that many
unemployed person as one who is not people migrate to an urban area, pick
able to get employment of even one hour up a job and stay there for some time,
in half a day. but come back to their home villages
There are three sources of data on as soon as the rainy season begins.
unemployment : Reports of Census of Why do they do so? This is because
India, National Statistical Office’s work in agriculture is seasonal; there
Reports of Employment and are no employment opportunities in the
Unemployment Situation, Annual village for all months in the year. When
Reports of Periodic Labour Force there is no work to do on farms, people
Survey, and Directorate General of go to urban areas and look for jobs.

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 6.9 GOVERNMENT AND
EMPLOYMENT GENERATION
You may recall about
the Mahatma Gandhi National
Rural Employment Guarantee
Act 2005. It promises 100 days
of guaranteed wage employment
to all rural households who
volunteer to do unskilled
manual work. The scheme
based on this Act is one of the
many measures the
government has implemented
to generate employment for
those who are in need of jobs
in rural areas.
Fig. 6.7 Dam construction work is a direct way of Since Independence, the
employment generation by the government
Union and State governments
This kind of unemployment is known have played an important role in
as seasonal unemployment. This is also generating employment or creating
a common form of unemployment opportunities for employment
prevailing in India. generation. Their efforts can be
Though we have witnessed slow broadly categorised into two — direct
growth of employment, have you seen and indirect. In the first category, as
people being unemployed over a very you have seen in the preceding section,
long time? Scholars say that in India, the government employs people in
people cannot remain completely
various departments for administrative
unemployed for very long because their
purposes. It also runs industries,
desperate economic condition would
hotels and transport companies, and
not allow them to be so. You will rather
find them being forced to accept hence, provides employment directly
jobs that nobody else would do, to workers. When the output
unpleasant or even dangerous jobs in of goods and services from
unclean, or unhealthy surroundings. government enterprises increases, then
The Central and State governments private enterprises which receive raw
take initiatives and generate materials from government enterprises
employment to facilitate a decent living will also raise their output and hence
for low income families through various increase the number of employment
measures. These will be discussed in opportunities in the economy. For
the following section. example, when a government owned

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steel company increases its output, it technology now frequently permit a
will result in direct increase in highly competitive existence for efficient
employment in that government small scale and often individual
company. Simultaneously, private enterprises or specialist workers side by
companies, which purchase steel from side with the multinationals.
it, will also increase their output and
Outsourcing of work is becoming a
thus employment. This is the indirect
common practice. It means that a
generation of employment
opportunities by the government big firm finds it profitable to close
initiatives in the economy. down some of its specialist
Many programmes that the departments (for example, legal or
governments implement, aimed at computer programming or customer
alleviating poverty, are through service sections) and hand over a large
employment generation. They are number of small piecemeal jobs to very
also known as employment small enterprises or specialist
generation programmes. All these individuals, sometimes situated even in
programmes aim at providing not other countries. The traditional notion
only employment but also services in of the modern factory or office, as a
areas such as primary health, result, has been altered in such
primary education, rural drinking
a manner that for many the home
water, nutrition, assistance for people
is becoming the workplace. All of
to buy income and employment
this change has not gone in favour
generating assets, development of
community assets by generating of the individual worker. The nature
wage employment, construction of of employment has become more
houses and sanitation, assistance for informal with only limited availability
constructing houses, laying of rural of social security measures to the
roads, development of wastelands/ workers.
degraded lands. In the last few decades, there
has been rapid growth in the gross
6.10 C ONCLUSION domestic product, but without
There has been a change in the simultaneous increase in employment
structure of workforce in India. Newly opportunities. This has forced the
emerging jobs are found mostly in the government to take up initiatives in
service sector. The expansion of the generating employment opportunities
service sector and the advent of high particularly in the rural areas.

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 Recap

Ø Allthose persons who are engaged in various economic activities and

hence contribute to gross national product are workers.

Ø About two-fifth of the total population in the country is engaged in various

economic activities.

Ø Men particularly rural men, form the major section of workforce in India.

Ø Majority of workers in India are self-employed. Casual wage labourers

and regular salaried employees together account for less than half the
proportion of India’s workforce.

Ø About three-fifth of India’s workforce depends on agriculture and other

allied activities as the major source of livelihood.

Ø In recent years, the growth of employment has decelerated.

Ø During post-reform period, India has been witness to employment

opportunities in the service sector. These new jobs are found mostly in
the informal sector and the nature of jobs is also mostly casual.

Ø Government is the major formal sector employer in the country.

Ø Disguised unemployment is a common form of unemployment in rural

India.

Ø There has been a change in the structure of the workforce in India.

Ø Through various schemes and policies, the government takes initiatives

to generate employment directly and indirectly.

EXERCISES

1. Who is a worker?
2. Define worker-population ratio.
3. Are the following workers — a beggar, a thief, a smuggler, a gambler?
Why?

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 4. Find the odd man out (i) owner of a saloon (ii) a cobbler (iii) a cashier
in Mother Dairy or Milk Cooperative Society of your area (iv) a tuition
master (v) transport operator (vi) construction worker.
5. The newly emerging jobs are found mostly in the sector
(service/manufacturing).
6. An establishement with four hired workers is known as
(formal/informal) sector establishment.
7. Raj is going to school. When he is not in school, you will find him
working in his farm. Can you consider him as a worker? Why?
8. Compared to urban women, more rural women are found working.
Why?
9. Meena is a housewife. Besides taking care of household chores, she
works in the cloth shop which is owned and operated by her husband.
Can she be considered as a worker? Why?
10. Find the odd man out (i) rickshaw puller who works under a rick-
shaw owner (ii) mason (iii) mechanic shop worker (iv) shoeshine boy.
11. The following table shows distribution of workforce in India for the
year 1972-73. Analyse it and give reasons for the nature of workforce
distribution. You will notice that the data is pertaining to the situation
in India about 50 years ago!

Place of Residence Workforce (in millions)

Male Female Total
Rural 125 69 195
Urban 32 7 39

12. The following table shows the population and worker population ratio
for India in 1999-2000. Can you estimate the workforce (urban and
total) for India?

Region Estimates of Worker Estimated

Population Population No. of Workers
(in crores) Ratio (in crores)

Rural 71.88 41.9 71.88 × 41.9 = 30.12

100
Urban 28.52 33.7 ?
Total 100.40 39.5 ?

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 13. Why are regular salaried employees more in urban areas than in
rural areas?
14. Why are less women found in regular salaried employment?
15. Analyse the recent trends in sectoral distribution of workforce in India.
16. Compared to the 1970s, there has hardly been any change in the
distribution of workforce across various industries. Comment.
17. Do you think that during 1950-2010 employment generated in the
country is commensurate with the growth of GDP in India? How?
18. Is it necessary to generate employment in the formal sector rather
than in the informal sector? Why?
19. Victor is able to get work only for two hours in a day. Rest of the day,
he is looking for work. Is he unemployed? Why? What kind of jobs
could persons like Victor be doing?
20. You are residing in a village. If you are asked to advice the village
panchayat, what kinds of activities would you suggest for the
improvement of your village which would also generate employment.
21. Who is a casual wage labourer?
22. How will you know whether a worker is working in the informal sector?

SUGGESTED ADDITIONAL ACTIVITIES

1. Select a region, say a street or colony, and divide it into 3-4

sub-regions. Conduct a survey by which you can collect the details
of activity each person living there is engaged in. Derive the
worker-population ratio for all the regions. Interpret the results for
differences in worker-population ratio for the different sub-regions.
2. Suppose 3-4 groups of students are given different regions of a state.
One region is mainly engaged in cultivation of paddy. In another region,
coconut is the main plantation. The third region is a coastal region
where fishing is the main activity. The fourth region has a river nearby
with a lot of livestock rearing activities. Ask all the four groups to
develop a report on what kind of employment could be generated in
the four regions.
3. Visit the local library and ask for Employment News, a weekly published
by the Government of India. Go through each issue for the last two
months. There will be seven issues. Select 25 advertisements and

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 fill in the following table (expand the table as needed). Discuss the
nature of jobs in the classroom.

Items Advertisement 1 Advertisement 2

1. Name of Office
2. Department/company
3. Private/public/joint venture
4. Name of the post
5. Sector—primary/seconday/
service
6. Number of posts/vacancies
7. Qualification required

4. You might notice, in your locality, a variety of works being done by

the government, for example laying of roads, desilting of tanks,
construction of school buildings, hospital and other government
offices, construction of check dams and houses for the poor etc.
Prepare a critical assessment report on one such activity. The issues
covered could be the following (i) how the work was identified (ii)
amount sanctioned (iii) contribution of local people, if any (iv) number
of persons involved — both men and women (v) wages paid (vi) is it
really required in that area and other critical comments on the
implementation of the scheme under which the work is being carried
out.
5. In recent years, you may have noticed that many voluntary
organisations also take initiatives to generate employment in hilly
and dry land regions. If you find such initiatives in your locality, visit
and prepare a report.

REFERENCES

CHADHA, G.K. and P.P. SAHU, 2002. ‘Post-reform Setbacks in Rural Employment:
Issues that need further scrutiny.’ Economic and Political Weekly, May
25, pp.1998-2026.
DESAI, S and M.B.DAS. 2004. ‘Is Employment Driving India’s Growth Surge’,
Economic and Political Weekly, July 3, pp. 3045-3051.
GHOSE, AJIT K. 1999. ‘Current Issues of Employment Policy in India.’ Economic
and Political Weekly, September 4, pp. 2592-2608.
HIRWAY, INDIRA. 2002. ‘Employment and Unemployment Situation in 1990s:
How Good are NSS Data.’ Economic and Political Weekly, May 25,
pp. 2027-2036.

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 J ACOB, PAUL. 1986. ‘Concept of ‘work’ and estimates of ‘workforce’ — An
appraisal of the treatment of activities relating to non-marketed output,’
Sarvekshana, Vol.IX, No.4, April.
KULSHRESHTHA, A.C., GULAB SINGH, ALOK KAR and R.L. MISHRA. 2000. ‘Workforce in
the Indian National Accounts Statistics,’ The Journal of Income and
Wealth, Vol.22, No.2, July, pp. 3-39.
PRADHAN, B.K. and M.R.SALUJA. 1996. ‘Labour Statistics in India: A Review.’
Margin, July- September, Vol.28, Number 4, pp. 319-347.
RATH, NILAKANTHA. 2001. ‘Data on Employment, Unemployment and Education:
Where to go from here?’ Economic and Political Weekly, June 9,
pp. 2081-2087.
SUNDARAM, K. 2001. ‘Employment-Unemployment Situation in the Nineties:
Some Results from NSS 55th Round Survey’, Economic and Political
Weekly, March 17, pp. 931-940.
SUNDARAM, K. 2001. ‘Employment and Poverty in 1990s: Further Results from
NSS 55th Round Employment-Unemployment Survey, 1999-2000,’
Economic and Political Weekly, August 11, pp. 3039-3049.
V ISARIA, PRAVIN. 1996. ‘Structure of the Indian Workforce, 1961-1994,’ The
Indian Journal of Labour Economics, Vol.39, No.4, pp. 725-740.

Government Reports

Annual Reports, Ministry of Labour, Government of India, Delhi.

Census of India 2011, Primary Census Abstract, Registrar General of Census
Operations, Ministry of Home Affairs, Government of India, Delhi.
Economic Survey, Ministry of Finance, Government of India.
Reports on Employment and Unemployment Situation in India, Ministry of
Statistics and Planning, Government of India.
Annual Report of Periodic Labour Force Survey 2017-18, National Statistical
Office, Ministry of Statistics and Programme Implementation, Government
of India, New Delhi.

Websites

www.censusofindia.nic.in
www.mospi.nic.in

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