Informal sector employs 72% of workers, says NSSO

Aug 28 2014, 01:07 IST
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SummaryIndia’s informal sector employed 72% of workers in 2011-12 compared with 78% in 2004-05, with wages remaining as low as R155 per day.

India’s informal sector employed 72% of workers in 2011-12 compared with 78% in 2004-05, with wages remaining as low as R155 per day. Besides, most of the casual labourers were not under any social security scheme, the NSSO said in a report.

The 68th round of the survey of the NSSO also shows that manufacturing, construction, wholesale and retail trade, transportation and storage industries accounted for 73% of informal jobs in

rural areas and 75% in urban areas.

In fact, the proportion of workers in the informal sector had fallen sharply from 78% in 2004-05 to 71% in 2009-10, when the GDP growth averaged at 8.5%. The proportion of the informal sector workers rose to 72% in 2011-12 as GDP growth started slowing.

“Between 2004-05 and 2011-12 while the overall decline in the share of employment in the informal sector was about 5 percentage points in India — the decline was about 6 percentage points in rural areas and 3 percentage points in urban areas. The decline for males was about 3 percentage points and that of females was about 11 percentage points,” the report said.

Of the 1.2 billion population, about 39% were employed — the proportion was about 40% in rural areas and 36% in urban areas. Of the total informal sector workforce, 75% were in rural areas and about 69% in urban areas.

Most of informal sector workers are in smaller enterprises, employing less than 6 workers. Among informal sector workers, about 75% in rural areas and 70% in urban areas were engaged in smaller enterprises.

While the average daily earnings of a regular wage employee was about R401, it was about R225 for those in the informal sector and about R127 for those employed in households. Average daily earnings of a regular wage/salaried employee in the informal sector was about R189 for rural males, R121 for rural females, R258 for urban males and R194 for urban females.

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