Transcript Informal Employment in the organised sector: The Challenge

Widening Exclusion:
Informalisation in the Indian
Economy
Ravi Srivastava
19
81
-8
19 2
83
-8
19 4
85
-8
19 6
87
-8
19 8
89
-9
19 0
91
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19 2
93
-9
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95
-9
19 6
97
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19 8
99
-0
20 0
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-0
20 2
03
-0
4
Millions
Emp. In Organised Manufacturing
(ASI)
12
8
4
0
Total Employment
Total Workers
Organised Sector Employment
(DGET)
250.00
Pvt Man.
200.00
Pub. Man
Pub+Pvt Man
150.00
Pvt Total
100.00
Pub Total
Pub+Pvt Total
50.00
20
04
20
02
20
00
19
98
19
96
19
94
0.00
19
81
(Lakhs)
300.00
% of Emoluments & Wages to GVA
in Org. Man.
45
40
35
30
25
20
15
10
5
0
1981-82
1991-92
Emoluments/GVA
2003-04
Wages/GVA
Share of Unorganised Sector in Employment and Value
Added: All India (DGET, CSO)
Year
Share of Unorganised Sector in (per cent)
Employment
Gross Domestic Product
1
1977-78
2
92.2
3
68.1
1982-83
1987-88
1990-91
92.0
92.2
92.2
66.4
63.0
63.8
1993-94
1999-2000
2002-03
92.7
93.0
-
62.3
59.2
56.7
NCEUS definition
Unorganised Sector
“The unorganized sector consists of all unincorporated
private enterprises owned by individuals or households
engaged in the sale and production of goods and
services operated on a proprietary or partnership basis
and with less than ten total workers”
Unorganised Worker
“Un-organized workers consist of those working in the
un-organized sector or households, excluding regular
workers with social security benefits provided by the
employers and the workers in the formal sector without
any employment and social security benefits provided by
the employers”
Total workforce in agriculture and non-agriculture sector by
activity status in 1993-94, 1999-2000 and 2004-05 (million)
Activity Status
Agriculture
Non-agriculture
Total
1993-94
Self-employed
Regular wage workers
Casual employee
Total
143.19
60.94
204.13
3.31
47.83
51.13
91.84
27.22
119.06
238.34
135.99
374.33
137.28
70.93
208.21
3.46
55.59
59.05
96.93
32.57
129.50
237.67
159.09
396.76
166.18
92.07
258.25
2.83
66.72
69.55
89.91
39.75
129.67
258.93
198.54
457.46
1999-2000
Self-employed
Regular wage workers
Casual employee
Total
2004-05
Self-employed
Regular wage workers
Casual employee
Total
Growth rate of workforce in agriculture and non-agriculture by activity
status between 50th, 55th and 61st NSSO Round
Activity Status
Agriculture
Non-agriculture
Total
1993-94 and 1999-2000
Self-employed
-0.70
2.56
0.33
Regular wage workers
0.75
2.54
2.43
Casual employee
0.90
3.03
1.41
-0.05
2.65
0.97
3.89
5.35
4.40
Regular wage workers
-3.91
3.72
3.33
Casual employee
-1.49
4.07
0.03
1.73
4.53
2.89
1.36
3.82
2.16
Regular wage workers
-1.40
3.07
2.84
Casual employee
-0.19
3.50
0.78
0.76
3.50
1.84
Total
1999-2000 and 2004-05
Self-employed
Total
1993-94 and 2004-05
Self-employed
Total
Employment in the Organised &
Unorganised Sector, 1999-00 &
2004-05
Unorganised
sector
Organised
sector
Total
Figure (million)
1999-2000
342.64
54.12
396.76
2004-05
394.90
62.57
457.46
Percentage of sector to total
1999-2000
86.36
13.64
100.00
2004-05
86.32
13.68
100.00
Employment Growth Rates by Economic Activity and
Sector
Economic Activity Unorganised
Sector
Organised
Sector
Total
Industry
6.13
4.79
5.73
Services
4.48
1.70
3.67
Non-agriculture
5.17
3.02
4.53
Total
2.88
2.94
2.89
Source: NSSO 55th & 61st Round Survey
Employment Growth Rate between 2000 and 2005 as per
DGET
Major Industry Group
Argiculture, hunting etc.
Private
Public
Organised
Private &
Public
1.69
-0.71
0.85
Mining and quarrying
-0.50
1.88
1.69
Manufacturing
-2.46
-5.89
-3.21
3.63
-1.89
-1.63
-2.98
-3.54
-3.53
Wholesale and retail trade
2.59
2.45
2.54
Transport, storage & communications
3.96
-2.21
-2.05
Finance, insurance, real estate etc.
7.88
1.67
3.13
Community, social & personal
services
1.10
-1.09
-0.75
-0.45
-1.39
-1.10
Electricity, gas and water
Construction
Total
Source: DGET
Employment Growth Rate between 1999-2000 and 200405 as per ASI
Manufacturing Total ASI Sector
Total Worker
0.57
0.68
Total Persons
Engaged
0.83
0.99
Source: ASI summary results for factory sector 1999-2000 & 2004-05
Employment Elasticity between 1999-2000 and 2004-05
Industry
Group
Agriculture
Industry
Services
Non-Agr.
Total
Unorganised Organised
sector
sector
Total
1.50
1.07
0.72
0.84
0.19
0.69
0.19
0.37
1.09
0.87
0.48
0.62
0.71
0.36
0.48
Source: Employment data taken from NSSO 55th & 61st Round and GVA estimated by
NCEUS using Modified Method of apportioning
Estimated number of workers by sector and type of worker
in 1999-2000 and 2004-05 (million)
Informal
workers
Formal
workers Total
1999-2000
Unorganised sector
Organised sector
Total
341.28
1.36
342.64
20.46
33.67
54.12
361.74
35.02
396.76
393.47
1.43
394.90
29.14
33.42
62.57
422.61
34.85
457.46
2004-05
Unorganised sector
Organised sector
Total
Estimated number of non-agriculture workers by sector and
type of worker in 1999-2000 & 2004-05 (m.)
worker
Informal
workers
Formal
workers
Total
1999-2000
Unorganised
Organised
Total
109.37
1.06
110.43
17.58
31.08
48.66
126.95
32.13
159.09
140.65
1.42
142.07
25.89
30.58
56.47
166.54
31.99
198.54
2004-05
Unorganised
Organised
Total
Percentage distribution of non-agriculture workers by
sector and type of workers to total non-agriculture workers
worker
Informal
workers
Formal
workers
Total
1999-2000
Unorganised
99.04
0.96
100.00
Organised
36.13
63.87
100.00
Total
79.80
20.20
100.00
2004-05
Unorganised
99.00
1.00
100.00
Organised
45.85
54.15
100.00
Total
83.89
16.11
100.00
Comparison of Organised Sector
Employment (lakhs)
Manufacturing
Formal
ASI
DGET
NSS
Informal
All
Total
Formal
Informal
Total
99-00
----
----
81.8
----
----
----
04-05
----
----
83.8
----
----
----
99-00
----
----
67.4
----
----
280.9
04-05
----
----
57.2
----
----
264.6
99-00
68.8
62.5
131.6
336.7
204.6
541.2
04-05
60.6
100.6
160.6
334.2
291.4
625.7
Growth rate of workers by sector and type of
worker between 1999-2000 and 2004-05 (%)
Sector
Informal
workers
Formal
workers Total
Unorganised sector
2.89
1.10
2.88
Organised sector
7.33
-0.15
2.94
Total
3.16
-0.10
2.89
Employment growth rate between 1999-2000 and 2004-05 by major
industry group and sector
Organised Sector
Major Industry Group
Informal worker Formal worker
Total
Agriculture
2.46
1.89
2.20
Manufacturing
9.98
-2.68
4.11
Electricity
5.53
2.82
3.16
construction
7.15
2.47
6.58
Trade
1.57
-10.98
-3.68
Hotels
12.96
1.64
8.44
4.96
-0.22
1.26
Finance
21.75
3.07
5.49
Real estate
17.50
14.97
15.94
Education
16.66
3.22
6.22
Health
15.66
1.69
4.89
Non-agriculture
8.05
-0.32
3.02
Total
7.33
-0.15
2.94
Transport
Employment Growth Rate of Informal and Formal Workers
by Economic Activity, 1999-00/2004-05
Economic Activity Informal
Workers
Formal
Workers
Total
Workers
Industry
Services
6.66
4.71
-0.60
0.12
5.73
3.67
Non-agriculture 5.58
-0.09
4.53
Total
-0.10
2.89
3.16
Source: NSSO 55th & 61st Round Survey
Growth rate of organised sector informal-formal workers by
sex and industry group between 1999-2000 & 2004-05
Sex
Male
Industry
Informal
13.45
9.92
11.61
Formal
-1.80
-0.82
-1.10
3.33
1.15
1.88
Informal
15.41
15.32
15.35
Formal
-1.84
1.75
1.19
6.24
5.52
5.67
13.74
11.39
12.42
-1.81
-0.36
-0.75
3.65
2.01
2.53
Total
Female
Services Non-agriculture
Total
Informal
Persons Formal
Total
Source: NSSO 55th & 61st Round
Growth rate of organised sector informal-formal workers by
area and industry group between 1999-2000 & 2004-05
Area
Rural
Workers
Informal
14.22
13.64
13.88
Formal
-2.45
-0.72
-1.13
4.20
2.65
3.09
Informal
13.49
9.96
11.58
Formal
-1.57
-0.19
-0.58
3.42
1.69
2.26
13.74
11.39
12.42
-1.81
-0.36
-0.75
3.65
2.01
2.53
Total
Urban
NonIndustry Services
agriculture
Total
Informal
Rural +
Formal
Urban
Total
Source: NSSO 55th & 61st Round
Incremental employment between 1999-2000 & 2004-05
(lakh)
Organised Sector
Major Industry Group
Agriculture
Informal worker
Formal worker Total
3.72
2.55
6.27
38.09
-8.75
29.33
0.39
1.36
1.75
16.54
0.79
17.33
Trade
0.98
-4.97
-3.99
Hotels
2.49
0.21
2.70
Transport
3.04
-0.33
2.71
Finance
2.79
2.61
5.39
Real estate
3.00
4.12
7.12
Administration
1.09
-10.27
-9.18
13.11
8.67
21.78
3.24
1.16
4.40
Non-agriculture
83.14
-4.99
78.15
Total
86.86
-2.44
84.42
Manufacturing
Electricity
construction
Education
Health
Percentage distribution of incremental employment
between 1999-2000 & 2004-05 (lakh)
Organised Sector
Major Industry Group
Agriculture
Informal worker
Formal
worker
Total
4.41
3.02
7.43
45.12
-10.36
34.74
0.46
1.61
2.07
19.59
0.94
20.53
Trade
1.16
-5.89
-4.73
Hotels
2.95
0.25
3.20
Transport
3.60
-0.39
3.21
Finance
3.30
3.09
6.38
Real estate
3.55
4.88
8.43
Administration
1.29
-12.17
-10.87
15.53
10.27
25.80
3.84
1.37
5.21
98.48
-5.91
92.57
102.89
-2.89
100.00
Manufacturing
Electricity
construction
Education
Health
Non-agriculture
Total
Increase & growth rate of
employment in the OS, by
activity type
Activity Status
Informal
workers
Formal
workers
Total
Increase in employment between 1999-2000 & 2004-05 (million)
Self-employed
0.23
0.59
0.82
Regular wage employee
6.01
-1.09
4.92
Casual labour
2.07
0.00
2.07
Total
8.31
-0.50
7.82
Growth Rate between 1999-2000 & 2004-05 (%)
Self-employed
8.95
6.46
7.01
12.42
-0.75
2.53
Casual labour
3.99
0.00
3.99
Total
8.05
-0.32
3.02
Regular wage employee
Growth of Regular Wage Employee by type of work and
sector between 1999-2000 & 2004-05
Sector
NonIndustry Services agriculture
Informal
5.25
6.19
5.94
6.55
5.7
5.99
5.34
6.17
5.94
Informal
13.74
11.39
12.42
Formal
-1.81
-0.36
-0.75
Total
3.65
2.01
2.53
Informal
8.96
7.61
8.06
-1.39
-0.14
-0.48
4.2
3.51
3.72
Unorganised
Formal
sector
Total
Organised
sector
Total worker Formal
Total
Source: NSSO 55th & 61st Round
Average Daily Earning of Workers in the Age Group 15 to
59 Years (1993-94 Prices)
Agriculture
Category
Non-Agriculture
Status
1999-00
2004-05
1999-00
2004-05
Regular
44.2
41.1
90.8
88.2
Casual
25.5
27.8
37.5
39.5
Regular
31.0
31.5
91.3
51.6
Casual
18.0
19.3
23.5
25.8
Regular
92.9
52.1
106.5
101.4
Casual
30.0
28.1
39.3
38.2
Regular
38.9
39.6
97.3
76.5
Casual
19.4
17.2
24.7
23.7
Rural Male
Rural Female
Urban Male
Urban Female
Growth rate of Average Daily Earning of Workers
in the Age Group 15 to 59 Years (1993-94 Prices)
Category
Rural Male
Rural Female
Urban Male
Status
Agriculture
Non-Agriculture
Regular Salaried
-1.44
-0.58
Casual workers
1.74
1.04
Regular Salaried
0.32
-10.79
Casual workers
1.40
1.89
Regular Salaried
-10.92
-0.98
Casual workers
-1.30
-0.57
Regular Salaried
0.36
-4.70
-2.38
-0.82
Urban Female Casual workers
Wages of Regular Workers (US.
IW/OS, FW/OS), 2004-05
350
300
250
Male
200
Female
150
Total
100
50
Rural
Urban
FW/OS
IW/OS
US
FW/OS
IW/OS
US
FW/OS
IW/OS
US
0
Combined
Conclusion
• Only one time period results available at present from the
NSSO. Issues with the base year (99-00).
• Variance with alternative estimates. Both size and growth of
employment in Organised Sector is larger.
• While under coverage may be one issue, more significant
issue related to informal workforce.
• Growth in informal workforce, including sizeable numbers of
regular workers – low paid & without protection – but a pointer
to changing functional and skill requirements.
• Institutional and labour rigidities have not deterred the OS
from increasing employment of flexible labour.
• Along with the Unorganised Sector issues, quality of
employment and lack of employment and social protection
emerging as a significant issue.