JOIN USIndia has a labour force of 52 crore – 40% of its population of 130 crore. Fortunately, we have almost reached a stable, non-increasing population growth state as of the year 2016.
Nearly 93% of the labour force is in the unorganised sector and are denied all civilisational benefits accessed by the remaining 7-8%, the minuscule organised sector. The organised sector is characterised by relative stability of employment, possibly inexorably increasing incomes, assured social security and retirement, life and health insurance benefits. Even though the organised sector may not be providing satisfactory incomes, economic and social security and stability concomitant to the sector entitle the workers to unprecedented economic, political and social privileges.
Now, the less fortunate unorganised sector employees are mostly found in villages and backward areas of cities and towns. According to the findings of the National Service Scheme and Census 2011, agriculture is the mainstay of these workers (49-55%). Even among these, more than 70% coming from smaller villages and growing numbers of census towns, depend on systemically low-income agriculture.
The National Council of Applied Economic Research’s India Human Development Survey, recently found that more than 50% of rural households have incomes from multiple sources, not necessarily agriculture. For 10 or more years, rural GDP arising from non-agriculture has surpassed 50% of the total; and this proportion possibly has been increasing. The growth of organised sector jobs in cities and towns – service and manufacturing sector – is almost seldom (jobless growth) and so, employment has per force to be sought almost only in the unorganised or informal sector. That is to say, we have to create income opportunities in the rural agricultural sector.
The national policy regarding creation of better quality organised sector jobs is inconsequential. The frequent official declarations about the resolve to create 10 million jobs per year have done very little about this need to augment organised sector jobs.
In contrast, the idea of “ease of doing business’’ is silent about creation of standard jobs. In fact, the trend to outsource many segments of work in the formal sector to private agencies or informalisation of employment is gaining ground. The governments are no exception to this trend. The rhetoric, less government and more governance, has to be looked at in this perspective. Or, we may believe that the proportion of jobs in the unorganised sector will remain very high with no relief from this in future.
Here, we have to emphasise that employment in agriculture is almost entirely informal or unorganised — 49% employment and 14% of the GDP. While the manufacturing sector employs 13%, yielding 16% of the income. The richest, the service sector, employs hardly 27% and yields an income of 58%. (The remaining 11% are unemployed or unaccounted for.) This skewedness of income and employment in different sectors of the economy requires serious reflection and policy action.
Paradoxical growth
Growth has been the holy grail of economic administration and there is increasing rush towards the service sector even from rural areas and small towns. And unfortunately, they manifest, perhaps, an unarticulated aim of this high income service sector is to invent newer ways of minimising physical human intervention. Moreover, employment here is consequent to the elusive facilities for high skill training, obviously not readily accessible to the poor or average Indian households.
Under these circumstances, growth of employment and income has to be in agriculture, in rural sectors. And this has to be through a systemic increase in agricultural land productivity – provision of irrigation, economy in the use of irrigation water, improved seeds, multi cropping and rotation of crops, levelling of land, refurbishing of tanks and bunds, rainwater harvesting, using dung and green manure etc will contribute to higher and diversified incomes and services in the agricultural package.
Rural youth have to be encouraged to learn servicing of machines used in agriculture. Measures like soil testing, optimisation of use of inputs, banking, insurance, social and health security to villagers will all contribute to diversify opportunities in villages. These steps will gradually offset the disadvantages of the unorganised sector employment vis-a-vis the organised sector. In a way, employment characterising the urban formal sector will begin to flood India’s rural areas.
(The writer is a former professor, Maharaja’s College, University of Mysore, Mysuru)