Understanding the Dynamics of Employment Growth, Work, and Technology

People engage in various forms of work, from farming and factory jobs to office work and remote employment. Technology now allows for remote production of factory goods. Also, during the 2020-21 Covid-19 pandemic, many worked from home. 

People work for a living and a sense of self-worth, contributing to the national economy and supporting dependents.

Mahatma Gandhi emphasized education and training through various crafts. 

Let us understand different aspects of employment growth  in detail.

Diverse Realities: Nature and Dynamics of Employment in India (2017-18)

• Employment: It encompasses all economic activities contributing to a country’s gross national product (GNP). 
• Workers: They are individuals engaged in economic activities, whether employed by an employer or self-employed. 
  • Even those temporarily unable to work due to various reasons are considered workers. 
  • This definition extends to those assisting primary workers.
• Nature  and Status of Employment: 
  • In India it is diverse, with some working year-round and others seasonally. 
  • Many face issues like unfair wages.
  • In India, the workforce in 2017-18 totalled approximately 471 million, with a higher proportion in rural areas. 
  • About 77% are men, while women make up one-fourth of the rural workforce and one-fifth of the urban workforce. 
  • Women often perform unpaid tasks like cooking and farm labor, leading economists to argue they should also be considered workers, reflecting the intricate interplay of socio-economic factors in the context of employment growth.

Analyzing Worker-Population Ratios, Disparities, and Gender Dynamics in Indian Employment

• Worker-population Ratio: 
  • It  is a crucial indicator for assessing employment situations. 
  • It reveals the percentage of the population actively involved in producing goods and services. 
• Interpreting Workforce: 
  • A higher ratio signifies greater workforce engagement.
  • While medium or low ratios indicate a significant portion of the population not directly participating in economic activities.
• Calculating Worker-Population Ratio for India:
  • To calculate the worker-population ratio for India, Divide the total number of workers by the country’s population and multiply by 100.
  • In India, about 35 out of every 100 persons are workers,  reflecting the intricate dynamics of employment growth
    • Urban areas have a slightly lower ratio of around 34, 
    • While rural areas have a ratio of approximately 35 (Refer Figure). 

Worker-Population Ratio in India, 2017-2018

• Rural-Urban Disparities in Workforce Participation:

• • Factors Contributing: 

• • • This difference is due to limited resources and opportunities in rural areas, leading more people to enter the workforce. 
    • Urban areas offer diverse employment opportunities, with many pursuing education and seeking jobs suited to their qualifications and skills.
  • Economic Necessity and Gender Disparities:
    • In rural areas, economic conditions often require people to work, and there is a significant gender disparity, with more males engaged in economic activities. 
    • In urban areas, for every 100 urban females, only about 14 are working, while in rural areas, around 18 out of every 100 rural women participate in the labor market.
  • Societal Factors Influencing Lower Female Workforce Participation:
    • Especially in urban areas, When men can earn higher incomes, families often discourage female members from working. 
    • Household activities performed by women are often not recognized as productive work, leading to the underestimation of the number of women workers in the country.
• Considering the valuable contributions made by women to household maintenance and farming, there is a question about whether their numbers should be included in the count of women workers.

Exploring Self-Employment, Casual Labor, and Salaried Jobs in India’s Diverse Workforce

• Measure of Economic Activity: 
  • The worker-population ratio does not provide information about workers’ social status or working conditions.
  • Instead, it helps us understand the proportion of the population actively participating in economic activities.

To assess the quality of employment and the worker’s position in an enterprise, it’s necessary to consider their status within the enterprise.

Brick-making: a form of casual work

• Three examples from the construction industry illustrate different statuses (Refer Figure), 
  • Self-Employed: 
    • Workers who own and operate their own businesses for livelihood, like the cement shop owner, fall under this category. 
    • Approximately 52% of India’s workforce is self-employed.
    • Self-employment is a significant source of livelihood for both men and women, accounting for over 50% of the workforce, showcasing the intricate dynamics of employment growth.

 Distribution of Employment

• Casual Wage Laborers: 
  • These workers, like construction laborers, are engaged on a casual basis by others and receive remuneration for their work. 
  • They make up about 25% of India’s workforce.
  • Casual wage labor is the second major source, slightly more prevalent among women (24-27%). 
• Regular Salaried Employees: 
  • Workers employed by someone or an enterprise and paid wages on a regular basis are categorized as regular salaried employees. 
  • This group represents 23% of India’s workforce.
  • Regular salaried employment is also notable, with 23% of men and 21% of women engaged in such jobs, reflecting the diverse facets of India’s employment landscape and its patterns of employment growth.

• Workforce Distribution Disparities:
  • The distribution of the workforce differs between rural and urban areas. 
  • Self-employed and casual wage laborers are more common in rural areas
  • Urban areas have a higher prevalence of self-employment and regular salaried jobs (Refer Figure). 
  • This variation is influenced by factors such as land ownership in rural areas and the nature of enterprises in urban areas, which require regular workers.

Distribution of Employment by Region

Employment In Firms, Factories and Offices

• Shift in Employment: During a country’s economic development, there is a shift in labor from agriculture and related activities to industry and services. 
  • This process involves rural-to-urban migration. 
  • As development progresses, the industrial sector’s share of total employment decreases, while the service sector experiences rapid growth, showcasing the intricate patterns of employment growth.
• This shift can be observed by examining the distribution of workers across various industries.
  • Economic activities are typically categorized into eight industrial divisions: Agriculture, Mining and Quarrying, Manufacturing, Electricity, Gas and Water Supply, Construction, Trade, Transport and Storage, and Services. 

• These divisions can be simplified into three major sectors:
  • The primary sector (including Agriculture and Mining);
  • The secondary sector (including Manufacturing, Electricity, Gas and Water Supply, and Construction); and 
  • The service sector (including Trade, Transport and Storage, and Services).

Garment workers: upcoming factory employment for women

• Distribution of Employment by Economic Sectors: 
  • In India, the primary sector is the primary source of employment for the majority of workers.
  • The secondary sector employs around 24% of the workforce, and 
  • The service sector employs about 31%, illuminating the multifaceted nature of employment growth across diverse sectors.
• Rural India: 
  • Agriculture: Rural India relies heavily on the primary sector, with approximately 60% of its workforce engaged in agriculture, forestry, and fishing. 
  • Secondary Sector: About 20% of rural workers are involved in manufacturing and construction.
  • while the service sector employs another 20%, reflecting the evolving patterns of employment growth in rural areas.
• Urban areas: 
  • It prioritizes the service sector, with approximately 60% of urban workers engaged in this sector. 
  • The secondary sector provides employment for around one-third of the urban workforce, demonstrating the dynamic nature of employment growth in the urban landscape.

Distribution of Workforce by Industry, 2017-2018

• Gender Concentration in the Primary Sector Employment:
  • Both men and women are concentrated in the primary sector, with women’s participation being particularly high. 
  • About 57% of the female workforce is employed in the primary sector, while less than half of male workers are in that sector(Refer Figure), emphasizing the gender dimensions in the context of India’s evolving patterns of employment growth.