Chapter 7 – Employment Growth Informalisation and other Issues Solutions
Question - 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 30 years ago!
| Place of Residence | Workforce (in millions) |
| Male | Female | Total |
| Rural Urban | 125 32 | 69 7 | 195 39 |
Answer - 11 : -
(i) The total workforce in India in the year 1972-73 was 234 million that includes 195 million workforce of rural and 39 million of the urban population. This indicates a greater involvement of rural workforce comprising of 83 % of the total workforce as compared to 17% of the urban workforce. This is because a majority of rural population was engaged in agricultural and allied sectors.
(ii) The rural workforce comprises of 64% of the male workforce and 36% of female workforce. On the contrast, the urban workforce comprises of about 82% of male workforce and 18% of female workforce. The participation of males in both rural as well as in the urban areas is higher than the females because of the lack of opportunities available to women for acquiring education. Also, families often discouraged female members to take up job and, consequently, women were confined to household works only.
(iii) Comparing urban female work force with that of the rural female workforce, we can conclude that the females in the rural areas formed 36 % of the workforce, whereas, the females in the urban areas formed only 18% of the workforce. In the rural areas, despite a majority of the population was engaged in farming and allied activities, agricultural sector had low productivity. Consequent to the low productivity, rural people had low earnings that further led to widespread poverty in the rural areas.
Thus, it can be concluded by analysing the above data that Indian economy suffered from low productivity, acute unemployment and widespread poverty, disguised unemployment in agricultural sector and low female participation rate in the workforce 30 years ago
Question - 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 population (in crores) | Worker Population Ratio | Estimated No. of Workers (in crores) |
| Rural | 71.88 | 41.9 | 
|
| Urban | 28.52 | 33.7 | ? |
| Total | 100.40 | 39.5 | ? |
Answer - 12 : -
| Region | Estimates of population (in crores) | Worker Population Ratio | Estimated No. of Workers (in crores) |
| Rural | 71.88 | 41.9 |
|
| Urban | 28.52 | 33.7 | 
|
| Total | 100.40 | 39.5 | 
|
Question - 13 : - Why are regular salaried employees more in urban areas than in rural areas?
Answer - 13 : -
Regular salaried employees are those hired workers who are on the permanent payrolls of their employers. They are usually skilled workers and are entitled to all types of social security benefits. The concentration of these workers is higher in the urban areas as compared to the rural areas because such jobs require skilled and specialised workers. The opportunities to acquire and enhance such skills are available more in the urban areas. And these skills are acquired through the process of training and education that cannot be accessed in the rural areas due to the lack of investment, infrastructure and low literacy level of rural people. Further, the big companies are concentrated only in the urban areas due to the presence of infrastructure and availability of modern facilities like banks, transport and communication, etc. Therefore, the bulk of the jobs for the regular salaried employees are concentrated more in the urban areas resulting in the increase in number of the regular salaried employees.
Question - 14 : - Why are less women found in regular salaried employment?
Answer - 14 : -
Lesser women are found in regular salaried employment as compared to men because a larger proportion of women are engaged in the economic activities without stable contracts and steady income. The stable contracts and steady income are two features prevalent in the regular salaried employment. Women are engaged in informal segments of the economy, where they are not entitled to any social security benefits. Moreover, women work in more vulnerable situations than men and have lower bargaining power and, consequently, are paid lesser than the male workforce. Thus, the women workers are more likely to be found in the self-employment and casual work as compared to men rather than regular salaried employment.
Question - 15 : - Analyse the recent trends in sectoral distribution of workforce in India.
Answer - 15 : -
The three major sectors of an economy i.e. Primary, Secondary and Tertiary collectively are known as occupational structure of an economy. The primary sector includes agriculture, forestry, fishing, mining, etc. The secondary sector consists of manufacturing and construction activities. Tertiary sector includes various services like transport, communication, trade, etc. Primary sector is the prime source of employment for the majority of the workers in India. Its contribution is as high as 57.3 % of our total workforce. About 17.6% and 25.1% of the total workforce is employed in the secondary and the service sector respectively. People living in the urban areas are largely engaged in secondary and tertiary sectors and those in the rural areas are involved basically in primary sectors. Also, the tertiary sector is taking a lead over the secondary sector as a source of employment and increasing share in India’s GDP. As far as the distribution of male and female is considered, a high percentage of total female workforces are engaged in the primary sector than in the secondary and tertiary sectors.
Question - 16 : - Why are regular salaried employees more in urban areas than in rural areas?
Answer - 16 : -
Regular salaried employees are those hired workers who are on the permanent payrolls of their employers. They are usually skilled workers and are entitled to all types of social security benefits. The concentration of these workers is higher in the urban areas as compared to the rural areas because such jobs require skilled and specialised workers. The opportunities to acquire and enhance such skills are available more in the urban areas. And these skills are acquired through the process of training and education that cannot be accessed in the rural areas due to the lack of investment, infrastructure and low literacy level of rural people. Further, the big companies are concentrated only in the urban areas due to the presence of infrastructure and availability of modern facilities like banks, transport and communication, etc. Therefore, the bulk of the jobs for the regular salaried employees are concentrated more in the urban areas resulting in the increase in number of the regular salaried employees.
Question - 17 : - Why are less women found in regular salaried employment?
Answer - 17 : -
Lesser women are found in regular salaried employment as compared to men because a larger proportion of women are engaged in the economic activities without stable contracts and steady income. The stable contracts and steady income are two features prevalent in the regular salaried employment. Women are engaged in informal segments of the economy, where they are not entitled to any social security benefits. Moreover, women work in more vulnerable situations than men and have lower bargaining power and, consequently, are paid lesser than the male workforce. Thus, the women workers are more likely to be found in the self-employment and casual work as compared to men rather than regular salaried employment.
Question - 18 : - Analyse the recent trends in sectoral distribution of workforce in India.
Answer - 18 : -
The three major sectors of an economy i.e. Primary, Secondary and Tertiary collectively are known as occupational structure of an economy. The primary sector includes agriculture, forestry, fishing, mining, etc. The secondary sector consists of manufacturing and construction activities. Tertiary sector includes various services like transport, communication, trade, etc. Primary sector is the prime source of employment for the majority of the workers in India. Its contribution is as high as 57.3 % of our total workforce. About 17.6% and 25.1% of the total workforce is employed in the secondary and the service sector respectively. People living in the urban areas are largely engaged in secondary and tertiary sectors and those in the rural areas are involved basically in primary sectors. Also, the tertiary sector is taking a lead over the secondary sector as a source of employment and increasing share in India’s GDP. As far as the distribution of male and female is considered, a high percentage of total female workforces are engaged in the primary sector than in the secondary and tertiary sectors.
Question - 19 : - Compared to the 1970s, there has hardly been any change in the distribution of workforce across various industries. Comment.
Answer - 19 : -
India being an agrarian economy has majority of population dependent on the agricultural sector to earn their livelihood. Although, the developmental strategies in India have aimed at the reduction of population dependent on agriculture, yet the reduction in the population engaged in agricultural sector has not been significant. In 1972-73, about 74 % of the work force was engaged in primary sector which reduced to 60% in 1999-00. On the other hand, the shares of secondary and tertiary sectors in employment rose from 11 % to 16 % and 15 % to 24 % respectively. The work force distribution indicates that over the last three decades i.e. from 1972-2000, people have moved from self-employment and regular salaried employment to casual wage worker. This particular pattern of moving from self employment and regular salaried employment to casual wage work is termed as casualisation of work force. Thus, it can be concluded that although changes in the distribution of workforce have taken place, yet industrial and tertiary sector need to increase their share in the workforce distribution by generating more employment opportunities and absorbing excess labour from the agricultural sector.
Question - 20 : - Do you think that in the last 50 years, employment generated in the country is commensurate with the growth of GDP in India? How?
Answer - 20 : -
Economic growth implies growth in the GDP, i.e. growth in the aggregate output produced during an accounting period within the domestic territory of an economy. The increased output level is achieved by generating more employment opportunities and through employing better technology. During the recent past, India has witnessed jobless economic growth that raised the aggregate output level without the proportionate rise in the employment opportunities and, consequently, unemployment continued to exist. The reason is that the rise in GDP is caused by employing modern and improved technology that substituted labour for machines. This failed to generate new employment opportunities in the industrial and the tertiary sectors. Thus, the industrial and the tertiary sectors failed to absorb the excess labour from the agricultural sector. As a result, disguised unemployment in the agricultural sector continued along with low levels of productivity and massive poverty. In addition to this, MNCs that played an important role in India’s economic growth provided employment only to the educated and specialised workforce. These MNCs aimed at achieving higher output levels by employing better technology rather than generating greater employment opportunities. Thus, employment generated in the country does not commensurate with the growth of GDP in India.