Growth and Changing Structure of Employment

The economy of a country can describe the structure of employment in that country. The countries with a good rate of the economy have more people employed in their tertiary/quaternary sector than the primary and secondary sectors and when it comes to countries which have a poor economy, it can be said that more people in that particular country work in the primary sector than in secondary or tertiary sector.

Growth of Employment & Gross Domestic Product (GDP)

Fifty years of planned development have always aimed at the expansion of the economy through an increase in national product and employment

• During 1950-2010, the GDP of India grew at a positive rate and was higher than the employment growth at that moment at a time.
• There was always a lot of fluctuation in the growth of GDP, but employment grew at a positive rate, but not more than 2 %.
• However, in the late 1990s, there was a decline in employment growth and reached the level of growth that India had in the early stages of planning.
• During this time period, the economy witnessed the trend of ‘Jobless Growth’ as the gap between the growth of GDP and employment was enlarging. 
• A situation when the economy is able to produce more goods and services without a proportionate increase in employment opportunities is known as Jobless Growth.
• In other words, it is a situation when there is an overall acceleration in the growth rate of GDP in the economy without corresponding expansion in employment opportunities.

Changing Structure of Employment

As we all know, India is an agrarian nation. The majority of India’s population lives in rural areas and is dependent on agriculture for livelihood. The developmental strategies in many countries, including India, have always targeted at reducing at the proportion of people depending on agriculture.

• 74.3% of the workforce was engaged in the primary sector in 1972-73, which declined to 44.6.% in 2017-18. A noticeable shift from farm work to non-farm work was witnessed.
• Secondary and service sectors are showing a promising future for the Indian workforce, as shares of these sectors have increased from 10.9% to 24.4% and from 14.8% to 31%, respectively.

Casualization of Workforce  

Casualization refers to the process of moving from self employment and regular salaried employment to casual wage work. It is a situation when the percentage of casually-hired workers in the total workforce tends to rise over time. There has been a considerable shift of self employed and regular salaried employed to casual wage work over the last three decades (1972-2018).

Self Employment: People who operate their own farm and non-farm enterprises or are engaged independently in a profession or trade are called self employed and such type of employment is known as self employment. It continues to be the major employment provider, but its share declined from 61.4% in 1972-73 to 52.2% in 2017-18.

Regular Salaried Employees: People who work in other’s farm or non-farm enterprises, and in return receive wages on a regular basis are called regular employees. Its share has stagnated at around 14%. There is a marginal increase from 15.4% in 1972-73 to 22.8% in 2017-18.

Casual Workers: People who are casually engaged in other’s farm or non-farm enterprises and in return receive wages according to the terms of the daily or periodic contract are known as casual workers. Their share has increased from 23.2% in 1972-73 to 25% in 2017-18.

Reasons for Increasing Casualization

The various reasons are as follows:

• Low scope of earning: Marginal farmers and self-employed farmers are becoming casual workers because of the low scope of earnings in agricultural activities.
• Displacement of workers: Displacement of workers from large industries in urban areas has shifted the status of regular workers to casual workers.
• Slow growth: There is a slow growth of employment in the organized sector due to which workers are taking up casual jobs. 
• Increase demand: There is an increase in demand for casual workers in expanding construction, trade, and service activities in rural areas, which leads to casualization of workforce.