1. Widening Exclusion: Informalisation in the Indian Economy Ravi Srivastava

2. Emp. In Organised Manufacturing (ASI)

3. Organised Sector Employment (DGET)

4. % of Emoluments & Wages to GVA in Org. Man.

5. Share of Unorganised Sector in Employment and Value Added: All India (DGET, CSO) YearShare of Unorganised Sector in (per cent) EmploymentGross Domestic Product 123 1977-7892.268.1 1982-8392.066.4 1987-8892.263.0 1990-9192.263.8 1993-9492.762.3 1999-200093.059.2 2002-03-56.7

6. 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”

7. Total workforce in agriculture and non-agriculture sector by activity status in 1993-94, 1999-2000 and 2004-05 (million) Activity StatusAgricultureNon-agricultureTotal 1993-94 Self-employed143.1960.94204.13 Regular wage workers3.3147.8351.13 Casual employee91.8427.22119.06 Total238.34135.99374.33 1999-2000 Self-employed137.2870.93208.21 Regular wage workers3.4655.5959.05 Casual employee96.9332.57129.50 Total237.67159.09396.76 2004-05 Self-employed166.1892.07258.25 Regular wage workers2.8366.7269.55 Casual employee89.9139.75129.67 Total258.93198.54457.46

8. Growth rate of workforce in agriculture and non-agriculture by activity status between 50 th, 55 th and 61 st NSSO Round Activity StatusAgricultureNon-agricultureTotal 1993-94 and 1999-2000 Self-employed-0.702.560.33 Regular wage workers0.752.542.43 Casual employee0.903.031.41 Total-0.052.650.97 1999-2000 and 2004-05 Self-employed3.895.354.40 Regular wage workers-3.913.723.33 Casual employee-1.494.070.03 Total1.734.532.89 1993-94 and 2004-05 Self-employed1.363.822.16 Regular wage workers-1.403.072.84 Casual employee-0.193.500.78 Total0.763.501.84

9. Employment in the Organised & Unorganised Sector, 1999-00 & 2004-05 Unorganised sector Organised sectorTotal Figure (million) 1999-2000342.6454.12396.76 2004-05394.9062.57457.46 Percentage of sector to total 1999-200086.3613.64100.00 2004-0586.3213.68100.00

10. Employment Growth Rates by Economic Activity and Sector Economic ActivityUnorganised Sector Organised Sector Total Industry6.134.795.73 Services4.481.703.67 Non-agriculture5.173.024.53 Total2.882.942.89 Source: NSSO 55 th & 61 st Round Survey

11. Employment Growth Rate between 2000 and 2005 as per DGET Major Industry GroupPrivatePublic Organised Private & Public Argiculture, hunting etc.1.69-0.710.85 Mining and quarrying-0.501.881.69 Manufacturing-2.46-5.89-3.21 Electricity, gas and water3.63-1.89-1.63 Construction-2.98-3.54-3.53 Wholesale and retail trade2.592.452.54 Transport, storage & communications3.96-2.21-2.05 Finance, insurance, real estate etc.7.881.673.13 Community, social & personal services1.10-1.09-0.75 Total-0.45-1.39-1.10 Source: DGET

12. Employment Growth Rate between 1999-2000 and 2004- 05 as per ASI ManufacturingTotal ASI Sector Total Worker0.570.68 Total Persons Engaged0.830.99 Source: ASI summary results for factory sector 1999-2000 & 2004-05

13. Employment Elasticity between 1999-2000 and 2004-05 Industry Group Unorganised sector Organised sectorTotal Agriculture 1.500.191.09 Industry 1.070.690.87 Services 0.720.190.48 Non-Agr. 0.840.370.62 Total 0.710.360.48 Source: Employment data taken from NSSO 55 th & 61 st Round and GVA estimated by NCEUS using Modified Method of apportioning

14. Estimated number of workers by sector and type of worker in 1999-2000 and 2004-05 (million) Informal workers Formal workersTotal 1999-2000 Unorganised sector341.281.36342.64 Organised sector20.4633.6754.12 Total361.7435.02396.76 2004-05 Unorganised sector393.471.43394.90 Organised sector29.1433.4262.57 Total422.6134.85457.46

15. Estimated number of non-agriculture workers by sector and type of worker in 1999-2000 & 2004-05 (m.) worker Informal workers Formal workersTotal 1999-2000 Unorganised109.371.06110.43 Organised17.5831.0848.66 Total126.9532.13159.09 2004-05 Unorganised140.651.42142.07 Organised25.8930.5856.47 Total166.5431.99198.54

16. Percentage distribution of non-agriculture workers by sector and type of workers to total non-agriculture workers worker Informal workers Formal workersTotal 1999-2000 Unorganised99.040.96100.00 Organised36.1363.87100.00 Total79.8020.20100.00 2004-05 Unorganised99.001.00100.00 Organised45.8554.15100.00 Total83.8916.11100.00

17. Comparison of Organised Sector Employment (lakhs) ManufacturingAll FormalInformalTotalFormalInformalTotal ASI99-00---- 81.8---- 04-05---- 83.8---- DGET99-00---- 67.4---- 280.9 04-05---- 57.2---- 264.6 NSS99-0068.862.5131.6336.7204.6541.2 04-0560.6100.6160.6334.2291.4625.7

18. Growth rate of workers by sector and type of worker between 1999-2000 and 2004-05 (%) Sector Informal workers Formal workersTotal Unorganised sector2.891.102.88 Organised sector7.33-0.152.94 Total3.16-0.102.89

19. Major Industry Group Organised Sector Informal workerFormal workerTotal Agriculture2.461.892.20 Manufacturing9.98-2.684.11 Electricity5.532.823.16 construction7.152.476.58 Trade1.57-10.98-3.68 Hotels12.961.648.44 Transport4.96-0.221.26 Finance21.753.075.49 Real estate17.5014.9715.94 Education16.663.226.22 Health15.661.694.89 Non-agriculture8.05-0.323.02 Total7.33-0.152.94 Employment growth rate between 1999-2000 and 2004-05 by major industry group and sector Source: NSSO 55 th & 61 st Round Survey

20. Employment Growth Rate of Informal and Formal Workers by Economic Activity, 1999-00/2004-05 Economic ActivityInformal Workers Formal Workers Total Workers Industry6.66-0.605.73 Services4.710.123.67 Non-agriculture5.58-0.094.53 Total3.16-0.102.89 Source: NSSO 55 th & 61 st Round Survey

21. Growth rate of organised sector informal-formal workers by sex and industry group between 1999-2000 & 2004-05 Sex IndustryServicesNon-agriculture Male Informal13.459.9211.61 Formal-1.80-0.82-1.10 Total3.331.151.88 Female Informal15.4115.3215.35 Formal-1.841.751.19 Total6.245.525.67 Persons Informal13.7411.3912.42 Formal-1.81-0.36-0.75 Total3.652.012.53 Source: NSSO 55 th & 61 st Round

22. Growth rate of organised sector informal-formal workers by area and industry group between 1999-2000 & 2004-05 Area WorkersIndustryServices Non- agriculture Rural Informal14.2213.6413.88 Formal-2.45-0.72-1.13 Total4.202.653.09 Urban Informal13.499.9611.58 Formal-1.57-0.19-0.58 Total3.421.692.26 Rural + Urban Informal13.7411.3912.42 Formal-1.81-0.36-0.75 Total3.652.012.53 Source: NSSO 55 th & 61 st Round

23. Incremental employment between 1999-2000 & 2004-05 (lakh) Major Industry Group Organised Sector Informal workerFormal workerTotal Agriculture3.722.556.27 Manufacturing38.09-8.7529.33 Electricity0.391.361.75 construction16.540.7917.33 Trade0.98-4.97-3.99 Hotels2.490.212.70 Transport3.04-0.332.71 Finance2.792.615.39 Real estate3.004.127.12 Administration1.09-10.27-9.18 Education13.118.6721.78 Health3.241.164.40 Non-agriculture83.14-4.9978.15 Total86.86-2.4484.42 Source: NSSO 55 th & 61 st Round

24. Percentage distribution of incremental employment between 1999-2000 & 2004-05 (lakh) Major Industry Group Organised Sector Informal worker Formal workerTotal Agriculture4.413.027.43 Manufacturing45.12-10.3634.74 Electricity0.461.612.07 construction19.590.9420.53 Trade1.16-5.89-4.73 Hotels2.950.253.20 Transport3.60-0.393.21 Finance3.303.096.38 Real estate3.554.888.43 Administration1.29-12.17-10.87 Education15.5310.2725.80 Health3.841.375.21 Non-agriculture98.48-5.9192.57 Total102.89-2.89100.00

25. Increase & growth rate of employment in the OS, by activity type Activity Status Informal workers Formal workersTotal Increase in employment between 1999-2000 & 2004-05 (million) Self-employed0.230.590.82 Regular wage employee6.01-1.094.92 Casual labour2.070.002.07 Total8.31-0.507.82 Growth Rate between 1999-2000 & 2004-05 (%) Self-employed8.956.467.01 Regular wage employee12.42-0.752.53 Casual labour3.990.003.99 Total8.05-0.323.02

26. Growth of Regular Wage Employee by type of work and sector between 1999-2000 & 2004-05 Source: NSSO 55 th & 61 st Round Sector IndustryServices Non- agriculture Unorganised sector Informal5.256.195.94 Formal6.555.75.99 Total5.346.175.94 Organised sector Informal13.7411.3912.42 Formal-1.81-0.36-0.75 Total3.652.012.53 Total worker Informal8.967.618.06 Formal-1.39-0.14-0.48 Total4.23.513.72

27. Average Daily Earning of Workers in the Age Group 15 to 59 Years (1993-94 Prices) AgricultureNon-Agriculture CategoryStatus1999-002004-051999-002004-05 Rural Male Regular44.241.190.888.2 Casual25.527.837.539.5 Rural Female Regular31.031.591.351.6 Casual18.019.323.525.8 Urban Male Regular92.952.1106.5101.4 Casual30.028.139.338.2 Urban Female Regular38.939.697.376.5 Casual19.417.224.723.7

28. Growth rate of Average Daily Earning of Workers in the Age Group 15 to 59 Years (1993-94 Prices) CategoryStatusAgricultureNon-Agriculture Rural Male Regular Salaried-1.44-0.58 Casual workers1.741.04 Rural Female Regular Salaried0.32-10.79 Casual workers1.401.89 Urban Male Regular Salaried-10.92-0.98 Casual workers-1.30-0.57 Urban Female Regular Salaried0.36-4.70 Casual workers-2.38-0.82

29. Wages of Regular Workers (US. IW/OS, FW/OS), 2004-05

30. 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.