Class 12 Indian Economic Development EMPLOYMENTWORKER: A worker is an individual who is engaged in some production activity. Aworker is also defined as an individual who is engaged in the process of value- addition.Types of Workers ——_— [Self-employed Workers is yg These are those workers who are engaged in their ‘own business or own profession. They earn profit as a reward for their service: For example, a doctor working in his own clinic. Casual Workers These are those workers who work for others. They are hired by others, and are paid wages/salary as a reward of their services. For example,-a teacher working in a school Regular Workers They are daily wagers. They are not hired by their employers on regular basis. They are not given social security benefits, like provident fund, pension, etc. For example, workers working at the construction site These workers are on permanent pay-roll of their employers. They are given social security benefits like provident fund, pension, etc. yi" For example, a CA workit i ina bankLabour Supply, Labour Force, Workforce, Unemployment and Participation Rate Labour Supply: It refers to the amount of labour that the workers are willing to offer corresponding to a particular wage rate. It is measured in terms of man-hours of work in relation to wage rate. Labour Force: It refers to the number of workers actually working or willing to work. It is not related to wage rate. Labour Supply LabourForce Itrefers to the amount of labour that the workers are willing to offer corresponding to a particular wage rate. Itrefers to the number of workers actually working or willing to work Itis not related to wage rate. Labour supply can increase or decrease even when the number of workers remain constant because it is measured in terms of man-hours or man-days. Labour force increases or decreases only when the number of workers actually working or willing to work increases or decreases.Workforce: It refers to the number of persons actually working. It does not include those who are willing are to work but not working. Workforce = Labour Force — Number of persons willing to work but are actually not working. Unemployment: It refers to a situation when a person is willing to work at the existing wage rate, but not getting any work. Number of Unemployed persons = Labour Force — Workforce Number of Persons Unemployed Number of Persons Unemployed Labour Force 400 Rate of Unemployment = Participation Rate: It refers to the proportion of population that is engaged in the process of production It is also known as worker-population ratio: Total Workforce Participation Rate = Total Popiladlion x 100Size of Workforce in India India has workforce of around 471 million of persons. Male workers: 77% (including male child labourers) Female workers: 23% (including female child labourers) 75% of the total workforce is found in rural areas and 25% of the total workforce is found in urban areas. = Female workforce in rural areas is 25% of the total rural workforce. Female workforce in urban areas is 20% of the total urban workforce. It shows that: > bulk of our workforce is rural-based. » Percentage of female workers is low in total workforce. It is extreme low in urban areas.Ques. Why is the bulk of our Workforce Rural-based? Ans. = Bulk of our population is rural-based because of absolute poverty in rural areas. Poverty compel people in rural areas to engage themselves in employment. People are engaged in farming and allied activities, but contributes less to GDP. = This means low productivity of the workforce in rural areas. =. Their contribution to. GDP is less than 20%. Ques. Why is the percentage of female workers low, and lower still in urban areas? Ans. = Female education in India is still a far cry. It implies low opportunities for jobs. In urban areas, job work for women is governed by family decisions. So, job opportunities are not actually utilised,. Higher employment among women in rural areas is due to widespread poverty. Females are engaged in low paid and less productive jobs in rural areas, contributing less to GDP. It is a sign of social and economic backwardness.Rate of Participation across Rural and Urban Areas. It refers to the proportion of population that is engaged in the process of production. It is also Known as worker-population ratio. Worker-population Ratio across Rural and Urban Areas (2017-18) SEX RURAL URBAN TOTAL Men 51.7 a 52.1 Women 17s 14.2 16.5 Total _l 35, 33.9 34.7 1. High Dependency Ratio: Rate of participation is low in our country: It implies not many people are engaged in the process of production and value-addition. 2. Higher Rate of Participation, but Low Level of Productivity in Rural Areas: Larger percentage of population is engaged in production activity in rural areas as compared to urban areas. But contribution of rural economy to GDP is very less.3. High Rate of Participation for Women in Rural Areas: Rate of participation of women is higher in rural areas as compared with urban areas. > Higher employment among women in-rural areas is due to widespread poverty. Females have to avoid education and seek employment. > Females are engaged in low paid’and less productive jobs in rural areas, contributing less to GDP. Jobs without Education Less Productive Jobs —+ Low wages — Higher Rate of participation to support family Under-estimation of Women Workers in the Country: = Women rendering household services are not considered as workers. This is because they are not paid for itand itis difficult to calculate market value of services rendered by the housewives. » Womenworking on farms in rural areas and in family business in urban areas are not treated as workers because they are not paid for it. But unpaid men working on farms and in family business are considered as workers.In Percentage Distribution of Workers by Region and Gender Percentage Distribution of Workers according to Region Casual wage labourers Regular salaried ‘employees: ‘Self-employed In urban areas, percentage of regular salaried workers is highest because people look for skilled jobs in offices and factories. In rural areas, percentage of self-employed workers is highest because non-farm job opportunities are limited. So, people work on family farms as self-employedIn Percentage istribution of Workers by Region and Gender Percentage Distribution of Workers according to Gender Casual wage labourers Regular salaried employees Self-employed.Self-employment is the main source of livelihood. More than 50% of males and females are self-employed workers. In India, percentage of selfemployed workforce if highest because: » Literacy rate is low, It implies low acquisition of skill for wage jobs. ® India is developing economy, generating less job opportunities. » Due to our social environment, mobility of workers is low. Among female, percentage of casually hired workers is a bit higher because low level of education and high compulsion for jobs put them under a pressure to work at low wage as casual labourers.Occupational Structure Distribution of workforce across primary, secondary and tertiary sectors of the economy is called occupational structure. Primary Sector Secondary Sector Tertiary Sector = Agriculture = Manufacturing * Trade * Mining and quarrying | |= Electricity, Gas and = Transport and Water Supply Storage = Construction = Services100. 60 In Percentage | 40.6% 20 o x al Tertiary Sector [Ey secondary sector Primary Sector = 44.6 % of workforce is engaged in primary sector. But the contribution of primary sectorin GDP is low. Greater employment in primary sector shows that secondary sector and tertiary sectors have failed to generate ample job opportunities. Secondary sector is lagging behind tertiary sector. Itshows that industrialization has failed to make secondary sector the leading sector of growth. Percentage Distribution of Workers across different Sectors (2017-18)Distribution of Rural and Urban Workforce across different Sectors(2017-18) Rural Urban y Workforce Workforce Oo Tertiary Sector 100 80 Primary Sector In Percentage 8 40 20In urban area, most of the workforce is engaged in tertiary and secondary sector. In ruralareas, primary sector is the main Source of livelihood. In urban areas, secondary sector is lagging behind tertiary sector. It implies that trade, commerce, banking, insurance, health, education and related services are developing faster in urban areas than manufacturing activities. In rural areas, 59.8% of the total workforce is engaged in Primary sector because there is lack of non-farm job opportunities in the rural areas.Distribution of Male and Female Workforce across different Sectors(2017-18) - Male Female Workforce Workforce In Percentage= Abuge percentage of female workforce is engaged in primary sector because > in rural areas most of the people are engaged in farming and allied activities due to lack of non-farm job opportunities. » Mobility of women in rural areas is very low. They are unwilling to migrate for outside jobs. They prefer to do jobs close to their home even at low wage rate. Percentage of male workforce in primary sector is also higher because of lack of jobs outside agriculture in rural areas.Change in Occupational Structure There has been only a modest change in occupational structure of India overtime. Percentage of Workforce Sector 1950-51 2017-18 Primary 72.72 44.6 Secondary 10.02 24.4 [Tertiary | 1726 ‘| a4 = The shift from primary sector to secondary sector is noticeable, but it is not significant. = Greater the shift of workforce from primary sector to secondary and tertiary sector, greater is the pace of growth and development. But this change is insignificant in Indian economy. Still most of our workforce is engaged in primary sector.Jobless Growth Level of output can be increased in two ways > Through greater employment, and > Through better technology. = Indian economy is experiencing rise in GDP more through technology than the employment of labour. This is the situation of jobless growth. + Jobless growth is a situation when the level of outputin the economy tends to rise owing to innovative technology without any rise in the level of employment. Reasons of Jobless Growth: = Our growth process is increasingly hijacked by MNCs. These companies achieve high growth through efficient use of technology rather than manpower. Hence, growth is moving faster than the opportunities of employment. Itis a jobless growthCasualisation and Informalisation of Workforce Casualisation of workforce refers to a situation when the percentage of casually-hired workers in the total workforce tends to rise over time. * Qur workforce includes a large percentage of casual workers, and this percentage is rising. + Percentage of casually hired workers has increased from 23.2% in 1972-73 to 25% in 2017-18. Percentage of self-employed workers has decreased from 61.4% in 1972-73 to 52.2% in 2017-18. Percentage of regular salaried workers has increased from 15% in 1972-73 to 22.8% in 2017-18. Reasons of Casual in: * Bulk of self-employed workers are found in rural areas. + People work on own farms because there is lack of non-farm job opportunities in'rural areas. They are disguisedly unemployed. + So, they migrate to urban areas in search of jobs. These unskilled rural people get employment only as casual workers.Informalisation: Formal Sector: Formal sector refers to the organized sector of the economy. It includes all government departments, public enterprises and private establishments which hire 10 or more workers. Workers working in formal sector are called formal workers. Informal Sector: Informal sector refers to unorganized sector of the economy. It includes all private establishments which hire less than 10 workers. Workers working in informal sector are called informalFormal Workers Informal Workers Work in organized sector of the economy. Work in unorganized sector of the economy. They are entitled to get various social security benefits like provident fund, pension, etc They are not entitled to get any social security benefits like provident fund, pension, etc. They can form trade unions. They cannot form trade unions. They are protected by various labour laws, against uncertainties of the market. They are not protected by labour laws. They face uncertainties of the market. They are like regular workers They are like daily-wagers. Informalisation leads to casualisation. Informalisation of workforce is defined as a situation when percentage of workforce in the formal sector tends to decline and that in the informal sector tends to rise.Number of workers (in million) 350 300 250. 200 150 Formal Informal Male [1 remate Presently, 6% of our total workforce (30 million) is engaged in formal sector and rest 94% (443 million) in informal sector. Out of the total population in formal sector, 20% are females. Out of the total population in informal sector, 30% of the workforce are womenUnemployment Unemployment refers to a situation when people are willing to work at the existing wage rate, as well as able to work, but are not getting work. Types of Unemployment jisguised Seasonal Unemployment UnemploymentQ Disquised Unemployment: Disguised unemployment occurs when then number of workers engaged in a job is much more than actually required to accomplish it. There would be no change in the total production if some workers are withdrawn from that job. For example, If only 4 persons are required to cultivate a farm but 7 workers are engaged, then three persons are disguisedly unemployed it family system, family members continue to work on the same piece of > Per person availability of land decreases with the increase in number of members. > Lack of non-farm job opportunities forces them to work on family farms. Q Seasonal Unemployment; It is a type of rural unemployment. It occurs because agriculture is a seasonal occupation. During off-season, farm workers are out of jobs. They are unemployed during off-season. = Farmers who grow only one crop remain unemployed for 5 to 7 months.Ques. Give two ways of tackling the problem of disguised unemployment. Ans. > Integrated rural development that offers non-farm job opportunities in rural areas. > Development of urban industries that leads to rural-urban migration. Ques. Is disguised unemployment prevalent in agriculture alone? Ans. Disguised employment occurs mostly in agriculture sector. But is not only confined to agriculture. In public sector enterprises, lots of people idle all the time. It shows that more people are employed in public enterprises than actually required. It is a sign of disguised unemployment.Causes of Unemployment 1. Slow Growth Rate Slow growth rate fails to generate employment opportunities. Supply of labour force is more than available employment opportunities. 2. Rapid Growth of Population Rising population is decreasing the per head availability of jobs. 3. Agriculture - A Seasonal Occupation During off-season, farm workers are out of jobs. They are unémployed during off-season. 4. Lack of Irrigation Facilities Only.44% of agricultural land is covered under permanent means of irrigation. So, there is absence of multi-cropping and opportunities-of employment remains limited.5. Joint Family System Due to joint family system, family members continue to work on the same piece of land. It encourages disguised unemployment. It also hindrances mobility of labour. 6. Decay of Cottage and Small Industries Decay of small scale and cottage industries during the British rule has decreased the potential of self-employment in India. 7. Low Savings and Investments There is scarcity of capital to invest in small business units. Huge capital is invested in large-scale enterprises which uses capital intensive technique. Hence, employment opportunities remain limited. 8. Limited Mobility of Labour Due to family as well as social constraints, mobility of labour in India is very low. People aré unwilling to move to far-off places even when jobs are available there.Role of Government in Employment Generation Policies and programmes initiated by the government are largely focusing on providing employment to poorer section of the society. To remove poverty and provide employment opportunities, government of India launched various programmes like Swaranajayanti Gram Swarozgar Yojana, Sampoorna Gramin Rozgar Yojana, Swarna Jayanti Shahri Rozgar Yojana, etc. . National Rural Employment Guarantee Act: It provides guaranteed wage employment of 100 days to all those in the rural areas who are [Link] line and-are able to work and willing to work at the wage rate offered by the government. , Prime Minister's Rozgar Yojana (PMRY): This scheme is providing employment to educated unemployed. This provides aloan of Rs 1 lakh for opening one’s own enterprise and Rs 2 lakh for other activities.5. NEP of 1991 played direct role in generating employment opportunities. 6. New Economic Policy of Privatization generated new opportunities of employment in private sector. 7. Government creates employment directly by employing people in public enterprises. With the growth of public sector, private sector also grows. This way government indirectly provide employment through private enterprises. 8. Skill India, Make in India, Start-ups: Once these schemes of government become operational, the Indian economy would generate employment through self-employment Pe | 4% STARTUP © inva oe Gyn Skill India Plater area - Barer aR]