Home

/

School

/

CBSE

/

Class 11 Commerce

/

Economics

/

Employment: Growth - Informalisation and Other Issues

CBSE Explorer

Employment: Growth - Informalisation and Other Issues

AI Learning Assistant

I can help you understand Employment: Growth - Informalisation and Other Issues better. Ask me anything!

Summarize the main points of Employment: Growth - Informalisation and Other Issues.
What are the most important terms to remember here?
Explain this concept like I'm five.
Give me a quick 3-question practice quiz.

Summary

Chapter Summary: Employment, Growth, Informalisation and Other Issues

Key Concepts

  • Economic Activity: Activities contributing to the gross national product.
  • Worker: Individuals engaged in economic activities, including self-employed and those temporarily unable to work.
  • Workforce: Total number of workers in a country, with a significant portion residing in rural areas.
  • Unemployment: A situation where individuals who are capable of working are unable to find a job.

Gender Participation in Employment

  • Men participate more in economic activities than women, especially in urban areas.
  • For every 100 urban females, only about 19 are engaged in economic activities.
  • In rural areas, the participation rate is about 30 for every 100 women.

Employment Trends (1972-2023)

  • Sector-wise Employment:
    • Primary Sector: Decreased from 74.3% in 1972 to 46.1% in 2017-2018.
    • Secondary Sector: Increased from 10.9% to 24.9%.
    • Service Sector: Increased from 14.8% to 29.0%.
  • Status of Employment:
    • Self-employed: 61.4% in 1972, decreased to 55.6% in 2017-2018.
    • Regular salaried employees: Increased from 15.4% to 21.1%.
    • Casual wage labourers: Fluctuated, with a notable decrease to 23.3% in 2017-2018.

Government Initiatives

  • Government plays a crucial role in generating employment through various schemes and policies.
  • Reports and surveys are conducted to assess employment and unemployment situations.

Common Pitfalls in Understanding Employment

  • Misunderstanding the definition of a worker, including those engaged in unpaid household work.
  • Overlooking the significance of casual wage labourers who are often the most vulnerable.

Exam Tips

  • Focus on understanding the definitions and distinctions between different types of employment.
  • Be prepared to analyze data trends and their implications on the workforce.
  • Discuss the socio-economic factors affecting women's participation in the workforce.

Learning Objectives

Learning Objectives

  • Understand basic concepts relating to employment such as economic activity, worker, workforce, and unemployment.
  • Understand the nature of participation of men and women in various economic activities across different sectors.
  • Know the nature and extent of unemployment.
  • Assess government initiatives in generating employment opportunities across various sectors and regions.

Detailed Notes

Employment: Growth, Informalisation and Other Issues

Understanding Employment

  • Basic Concepts: Economic activity, worker, workforce, unemployment.
  • Gender Participation: Nature of participation of men and women in various economic activities across sectors.
  • Unemployment: Nature and extent of unemployment in India.
  • Government Initiatives: Assessment of initiatives taken by the government to generate employment opportunities.

Employment Patterns

Trends in Employment Pattern (Sector-wise and Status-wise), 1972-2023 (in %)

Item1972-7319831993-942011-20122017-2018
Sector
Primary74.368.66448.946.1
Secondary10.911.51624.324.9
Services14.816.92026.829.0
Total100.0100.0100.0100.0100.0

Employment Status

Status1972-7319831993-942011-20122017-2018
Self-employed61.457.354.652.055.6
Regular Salaried Employees15.413.813.618.021.1
Casual Wage Labourers23.228.931.830.023.3
Total100.0100.0100.0100.0100.0

Nature of Employment

  • Self-Employment: Major employment provider, especially in rural areas.
  • Casualisation of Workforce: Movement from self-employment and regular salaried employment to casual wage work, leading to vulnerability.
  • Gender Disparities: Higher concentration of women in the primary sector compared to men.

Government Initiatives

  • Employment Generation: Government's role in generating employment through various schemes and policies.
  • Sectoral Employment: Service sector growth post-reform, with new jobs primarily in the informal sector.

Conclusion

  • Workforce Composition: Majority of India's workforce is self-employed, with significant reliance on agriculture.
  • Challenges: Deceleration in employment growth and the prevalence of disguised unemployment in rural areas.

Exam Tips & Common Mistakes

Common Mistakes and Exam Tips

Common Pitfalls

  • Misunderstanding Employment Types: Students often confuse self-employed individuals with casual wage laborers. It's important to recognize that both categories exist and have different implications for job security and income.
  • Ignoring Gender Disparities: Many overlook the significant differences in employment rates between men and women, particularly in urban versus rural settings. This can lead to incomplete analyses in exam responses.
  • Neglecting Informal Sector Employment: Failing to account for the informal sector can skew understanding of overall employment trends, especially in discussions about job security and economic contributions.
  • Overlooking Disguised Unemployment: Students may not fully grasp the concept of disguised unemployment, particularly in agricultural contexts, which can lead to misinterpretations of employment data.

Exam Tips

  • Define Key Terms: Always define key terms such as 'worker-population ratio' and 'disguised unemployment' clearly in your answers to demonstrate understanding.
  • Use Data Effectively: When discussing trends, refer to specific data points (e.g., employment percentages in different sectors) to support your arguments.
  • Analyze Case Studies: Be prepared to analyze case studies or examples provided in the exam, as they often illustrate broader concepts in employment trends.
  • Discuss Government Initiatives: Include discussions on government initiatives aimed at employment generation, as these are often key points in exam questions.
  • Consider Societal Impacts: Reflect on how employment trends affect different demographics, particularly marginalized groups, to provide a comprehensive answer.

Practice & Assessment

Multiple Choice Questions

A.

A student studying at a university

B.

A farmer working in the fields

C.

A person doing household chores

D.

A retired person receiving a pension
Correct Answer: B

Solution:

Economic activities are those that contribute to the gross national product, such as farming.

A.

Women do not participate in economic activities.

B.

Household activities done by women are not recognized as productive work.

C.

Women are primarily employed in the formal sector.

D.

There is no significant difference in participation rates between men and women.
Correct Answer: B

Solution:

Many household activities done by women are not recognized as productive work, leading to their underestimation in workforce statistics.

A.

A farmer producing crops

B.

A teacher educating students

C.

A homemaker managing household chores

D.

A factory worker manufacturing goods
Correct Answer: C

Solution:

Economic activities contributing to the GNP include those that produce goods or services for the market. Homemaking, although valuable, is not considered an economic activity in this context as it does not involve market transactions.

A.

High wages

B.

Lack of formal education

C.

Surplus labor in agriculture

D.

Technological advancements
Correct Answer: C

Solution:

Disguised unemployment in rural India primarily persists due to surplus labor in agriculture, where more people are employed than necessary.

A.

High job security

B.

Access to social security benefits

C.

Lack of regular income and protection

D.

Over-regulation by the government
Correct Answer: C

Solution:

Workers in the informal sector face significant challenges such as lack of regular income, protection, and regulation, making their economic situation precarious.

A.

To earn a living

B.

To inherit money

C.

To avoid work

D.

To save labor
Correct Answer: A

Solution:

Employment provides individuals with a sense of self-worth and enables them to relate meaningfully with others, primarily through earning a living.

A.

Providing loans to businesses

B.

Directly employing people in various departments

C.

Reducing taxes for companies

D.

Encouraging foreign investments
Correct Answer: B

Solution:

The government directly employs people in various departments and runs industries, hotels, and transport companies, providing employment directly to workers.

A.

Rapid industrialization

B.

Increase in agricultural productivity

C.

Widening gap between GDP growth and employment generation

D.

Expansion of the informal sector
Correct Answer: C

Solution:

During the late 1990s, India experienced a widening gap between GDP growth and employment generation, leading to a decline in employment growth.

A.

Primary sector

B.

Secondary sector

C.

Service sector

D.

Informal sector
Correct Answer: A

Solution:

As per the trends in employment patterns, the primary sector in India continues to have the highest proportion of self-employed workers.

A.

A farmer working in fields

B.

A teacher giving private tuition

C.

A person gambling

D.

A shopkeeper selling goods
Correct Answer: C

Solution:

Gambling is not considered an economic activity as it does not contribute to the gross national product.

A.

Pradhan Mantri Awas Yojana

B.

Mahatma Gandhi National Rural Employment Guarantee Act

C.

Skill India Mission

D.

Make in India Initiative
Correct Answer: B

Solution:

The Mahatma Gandhi National Rural Employment Guarantee Act promises 100 days of guaranteed wage employment to all rural households willing to do unskilled manual work.

A.

Providing subsidies to private companies

B.

Dam construction work

C.

Tax incentives for startups

D.

Encouraging foreign investments
Correct Answer: B

Solution:

Dam construction work is an example of direct employment generation by the government.

A.

Movement from casual wage work to self-employment

B.

Increase in regular salaried employment

C.

Movement from self-employment and regular salaried employment to casual wage work

D.

Decrease in the number of casual wage laborers
Correct Answer: C

Solution:

Casualisation refers to the process where individuals move from self-employment and regular salaried employment to casual wage work, making them more vulnerable.

A.

Workers are employed but their contribution to output is negligible.

B.

Workers are fully employed with high productivity.

C.

Workers are employed in high-tech industries.

D.

Workers receive high wages for their work.
Correct Answer: A

Solution:

Disguised unemployment occurs when more people are employed than necessary, leading to negligible contribution to output. This is common in rural India where agricultural tasks often have more workers than needed.

A.

To gain social status

B.

To earn a living

C.

To acquire new skills

D.

To contribute to national income
Correct Answer: B

Solution:

People work primarily for 'earning' a living, which gives them a sense of self-worth and enables them to relate meaningfully with others.

A.

To provide urban employment opportunities.

B.

To offer skill development programs.

C.

To guarantee 100 days of wage employment in rural areas.

D.

To promote entrepreneurship in rural areas.
Correct Answer: C

Solution:

MGNREGA aims to provide 100 days of guaranteed wage employment to rural households who volunteer to do unskilled manual work, thereby improving rural employment.

A.

Only provides direct employment through government jobs.

B.

Focuses solely on the private sector for employment generation.

C.

Generates employment both directly and indirectly through various measures.

D.

Relies entirely on foreign investments for job creation.
Correct Answer: C

Solution:

The government generates employment both directly by employing people in various departments and indirectly by creating opportunities through enterprises and schemes.

A.

The movement from self-employment to regular salaried employment

B.

The shift from regular salaried employment to casual wage work

C.

The increase in formal sector employment

D.

The transition of workers from urban to rural areas
Correct Answer: B

Solution:

Casualisation refers to the process where workers move from self-employment and regular salaried employment to casual wage work, making them more vulnerable.

A.

To provide urban employment

B.

To guarantee 100 days of wage employment to rural households

C.

To promote industrial growth

D.

To increase agricultural productivity
Correct Answer: B

Solution:

The Mahatma Gandhi National Rural Employment Guarantee Act 2005 promises 100 days of guaranteed wage employment to all rural households who volunteer to do unskilled manual work.

A.

Agriculture and allied activities

B.

Manufacturing industries

C.

Service sector

D.

Construction
Correct Answer: A

Solution:

About three-fifth of India's workforce depends on agriculture and other allied activities as the major source of livelihood.

A.

Pradhan Mantri Awas Yojana

B.

Mahatma Gandhi National Rural Employment Guarantee Act

C.

Skill India Mission

D.

Startup India
Correct Answer: B

Solution:

The Mahatma Gandhi National Rural Employment Guarantee Act promises 100 days of guaranteed wage employment to rural households who volunteer to do unskilled manual work.

A.

Regular salaried employment

B.

Self-employment

C.

Casual wage labour

D.

Government jobs
Correct Answer: B

Solution:

Self-employment is the most common form of employment in rural India, with a significant portion of the workforce engaged in this type of employment.

A.

To earn a living and contribute to national income

B.

To avoid boredom

C.

To gain social status

D.

To fulfill family expectations
Correct Answer: A

Solution:

People work primarily to earn a living and contribute to the national income by engaging in various economic activities.

A.

A farmer working on the field

B.

A teacher giving tuition at home

C.

A person engaged in gambling

D.

A shopkeeper selling goods
Correct Answer: C

Solution:

Economic activities are those that contribute to the gross national product. Gambling does not contribute to the production of goods or services.

A.

They have secure jobs with regular income.

B.

They are covered by social security schemes.

C.

They often lack job security and work in informal settings.

D.

They are primarily employed in government sectors.
Correct Answer: C

Solution:

Casual wage laborers often lack job security, work in informal settings, and do not have regular income or social security.

A.

Secondary sector

B.

Service sector

C.

Primary sector

D.

Tertiary sector
Correct Answer: C

Solution:

The primary sector, which includes agriculture and allied activities, is the major source of employment for about 60% of the rural workforce in India.

A.

Formalisation

B.

Casualisation

C.

Industrialisation

D.

Urbanisation
Correct Answer: B

Solution:

The process of moving from self-employment and regular salaried employment to casual wage work is called casualisation of workforce.

A.

Structural unemployment

B.

Cyclical unemployment

C.

Frictional unemployment

D.

Disguised unemployment
Correct Answer: D

Solution:

Disguised unemployment is a common form of unemployment in rural India.

A.

Structural unemployment

B.

Cyclical unemployment

C.

Seasonal unemployment

D.

Frictional unemployment
Correct Answer: C

Solution:

Seasonal unemployment is common in India, especially in agriculture, where work is not available throughout the year.

A.

Primary sector

B.

Secondary sector

C.

Service sector

D.

Informal sector
Correct Answer: A

Solution:

The primary sector, which includes agriculture, forestry, and fishing, employs about 60% of the rural workforce in India.

A.

It employs the majority of the rural workforce.

B.

It has shown a significant increase in informal employment opportunities.

C.

It is the primary source of employment for women.

D.

It has decreased in importance compared to the primary sector.
Correct Answer: B

Solution:

In the post-reform period, the service sector in India has shown a significant increase in employment opportunities, mainly in the informal sector, offering mostly casual jobs.

A.

Primary sector

B.

Secondary sector

C.

Service sector

D.

Informal sector
Correct Answer: C

Solution:

During the post-reform period, India has witnessed a significant increase in employment opportunities in the service sector, particularly in the informal sector.

A.

Formalization

B.

Informalization

C.

Casualization

D.

Industrialization
Correct Answer: C

Solution:

The process of moving from self-employment and regular salaried employment to casual wage work is known as casualization of the workforce.

A.

High wages

B.

Job security

C.

Lack of protection and regulation

D.

Excessive government intervention
Correct Answer: C

Solution:

Workers and enterprises in the informal sector do not get regular income and lack protection or regulation from the government.

A.

Pradhan Mantri Gram Sadak Yojana

B.

Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA)

C.

Make in India

D.

Digital India
Correct Answer: B

Solution:

MGNREGA is a government initiative that provides 100 days of guaranteed wage employment to rural households willing to do unskilled manual work.

A.

Primary sector

B.

Secondary sector

C.

Service sector

D.

Informal sector
Correct Answer: C

Solution:

The service sector has shown a moderate rise in the share of regular salaried employees during the period 2011-2023, as indicated by the employment trends.

A.

Permanent

B.

Temporary

C.

Casual

D.

Contractual
Correct Answer: C

Solution:

The new jobs in the service sector are found mostly in the informal sector and the nature of jobs is also mostly casual.

A.

Primary sector

B.

Secondary sector

C.

Service sector

D.

Informal sector
Correct Answer: C

Solution:

During the post-reform period, India has witnessed employment opportunities in the service sector.

A.

20%

B.

33%

C.

60%

D.

75%
Correct Answer: C

Solution:

About 60% of the urban workforce in India is engaged in the service sector.

A.

Increase in regular salaried employment

B.

Shift from self-employment to casual wage work

C.

Growth of employment in the formal sector

D.

Rise in agricultural employment
Correct Answer: B

Solution:

Casualisation of workforce refers to the process of moving from self-employment and regular salaried employment to casual wage work.

A.

Lack of education among women

B.

Narrow definition of work that excludes household activities

C.

High participation of women in the formal sector

D.

Preference for part-time jobs by women
Correct Answer: B

Solution:

The underestimation of women's work in India is primarily due to the narrow definition of work, which often excludes household activities performed by women.

A.

It refers to people who are unemployed for a long duration.

B.

It refers to a situation where more people are employed than actually needed.

C.

It refers to seasonal unemployment in agriculture.

D.

It refers to unemployment due to technological advancements.
Correct Answer: B

Solution:

Disguised unemployment occurs when more people are employed than necessary, often seen in agricultural sectors where the workforce is not utilized to its full potential.

A.

Service sector

B.

Manufacturing sector

C.

Agriculture and allied activities

D.

Information Technology sector
Correct Answer: C

Solution:

About three-fifths of India's workforce depends on agriculture and other allied activities as the major source of livelihood.

A.

Increase in agricultural productivity

B.

Widening gap between GDP growth and employment

C.

Government policies favoring urban development

D.

Rise in self-employment
Correct Answer: B

Solution:

During the late 1990s, there was a widening gap between the growth of GDP and employment, leading to a decline in employment growth.

A.

Subsidizing agricultural inputs

B.

Mahatma Gandhi National Rural Employment Guarantee Act

C.

Reducing corporate taxes

D.

Providing educational scholarships
Correct Answer: B

Solution:

The Mahatma Gandhi National Rural Employment Guarantee Act directly generates employment by providing 100 days of guaranteed wage employment to rural households.

A.

High job security

B.

Regular income

C.

Lack of protection and regulation

D.

Advanced technology usage
Correct Answer: C

Solution:

The informal sector is characterized by a lack of protection or regulation from the government.

A.

High job security

B.

Regular income

C.

Lack of social security

D.

Government regulation
Correct Answer: C

Solution:

Jobs in the informal sector are characterized by a lack of social security and regulation, making workers vulnerable.

A.

Rapid industrialization

B.

Closure of textile mills

C.

Increase in agricultural activities

D.

Government policies
Correct Answer: B

Solution:

The closure of textile mills, as seen in Ahmedabad, led many workers to move to the informal sector.

A.

Primary sector

B.

Secondary sector

C.

Service sector

D.

Informal sector
Correct Answer: A

Solution:

About three-fifth of India's workforce depends on agriculture and other allied activities, which are part of the primary sector, as the major source of livelihood.

A.

Increase in self-employment

B.

Shift from regular salaried employment to casual wage work

C.

Growth in agricultural employment

D.

Rise in government employment
Correct Answer: B

Solution:

Casualisation refers to the process of moving from self-employment and regular salaried employment to casual wage work.

A.

Increase in formal sector jobs with social security benefits

B.

Shift of workers from the formal sector to the informal sector

C.

Rise in government employment opportunities

D.

Growth of self-employment opportunities in urban areas
Correct Answer: B

Solution:

Informalisation refers to the shift of workers from the formal sector, which provides job security and benefits, to the informal sector, where such securities are absent.

A.

By providing loans to start new businesses

B.

By offering skill training programs

C.

By guaranteeing 100 days of wage employment for rural households

D.

By promoting foreign direct investment in rural areas
Correct Answer: C

Solution:

MGNREGA aims to generate employment by guaranteeing 100 days of wage employment to rural households willing to do unskilled manual work.

A.

High job security and regular income

B.

Protection by social security schemes

C.

Lack of regulation and outdated technology

D.

High wages and modern technology
Correct Answer: C

Solution:

The informal sector in India is characterized by a lack of regulation, outdated technology, and the absence of social security schemes.

A.

Formalization

B.

Casualisation

C.

Industrialization

D.

Urbanization
Correct Answer: B

Solution:

The process of moving from self-employment and regular salaried employment to casual wage work is called casualisation of workforce.

True or False

Correct Answer: False

Solution:

The excerpts describe the informal sector as lacking regular income and job security.

Correct Answer: False

Solution:

About three-fifths of India's workforce depends on agriculture and other allied activities as the major source of livelihood.

Correct Answer: True

Solution:

Disguised unemployment occurs when more people are employed than actually needed, and it is common in rural areas where agriculture is the primary activity.

Correct Answer: False

Solution:

The majority of India's workforce resides in rural areas, as mentioned in the excerpts.

Correct Answer: False

Solution:

The excerpts state that the majority of workers in India are self-employed, with casual wage labourers and regular salaried employees together accounting for less than half of the workforce.

Correct Answer: False

Solution:

The excerpt states that about 60% of the workforce in rural India depends on agriculture, forestry, and fishing, making it the largest employer.

Correct Answer: False

Solution:

The Mahatma Gandhi National Rural Employment Guarantee Act promises 100 days of guaranteed wage employment to all rural households.

Correct Answer: False

Solution:

The excerpts mention that the growth of GDP in India has been higher than the growth of employment, and there has been a widening gap between the two.

Correct Answer: False

Solution:

Workers and enterprises in the informal sector do not get regular income and lack protection or regulation from the government.

Correct Answer: False

Solution:

The government is the major formal sector employer in the country, not the informal sector.

Correct Answer: True

Solution:

The excerpts mention that disguised unemployment is a common form of unemployment in rural India.

Correct Answer: False

Solution:

Workers and enterprises in the informal sector do not get regular income; they do not have any protection or regulation from the government.

Correct Answer: True

Solution:

The excerpts explain that the government generates employment directly by employing people in various departments and indirectly by increasing output in government enterprises that support private sector employment.

Correct Answer: True

Solution:

According to the excerpt, the government is the major formal sector employer in the country.

Correct Answer: True

Solution:

During the period 1950-2010, India's GDP grew positively and was higher than the employment growth.

Correct Answer: True

Solution:

According to the provided excerpts, about three-fifths of India's workforce depends on agriculture and other allied activities as the major source of livelihood.

Correct Answer: True

Solution:

The excerpts mention that about 60% of urban workers are employed in the service sector.

Correct Answer: True

Solution:

Self-employment continues to be the major employment provider in India.

Correct Answer: False

Solution:

In recent years, the growth of employment has decelerated.

Correct Answer: False

Solution:

Casual wage labourers and regular salaried employees together account for less than half the proportion of India's workforce.

Correct Answer: True

Solution:

Self-employment continues to be the major employment provider in India.

Correct Answer: False

Solution:

The excerpts indicate that about 25% of the workforce is employed in the secondary sector, not more than half.

Correct Answer: True

Solution:

The excerpt describes the informal sector as lacking regular income, protection, or regulation from the government.

Correct Answer: True

Solution:

The excerpts state that during 1950-2010, India's GDP grew positively and was higher than employment growth.

Correct Answer: True

Solution:

According to the provided excerpts, the majority of workers in India are self-employed, with casual wage labourers and regular salaried employees together accounting for less than half of India's workforce.

Correct Answer: True

Solution:

The excerpts indicate that about three-fifths of India's workforce depends on agriculture and other allied activities, which are part of the primary sector.

Correct Answer: True

Solution:

The excerpts describe the informal sector as using outdated technology, and workers in this sector do not receive regular income.

Correct Answer: True

Solution:

In rural areas, for every 100 rural women about 30 participate in the employment market, whereas in urban areas, only about 19 out of 100 urban females are engaged in some economic activities.

Correct Answer: False

Solution:

Disguised unemployment is a common form of unemployment in rural India.

Correct Answer: True

Solution:

Men, particularly rural men, form the major section of the workforce in India.

Correct Answer: False

Solution:

The excerpts describe the informal sector as lacking regular income and protection or regulation from the government, with outdated technology and no social security.

Correct Answer: True

Solution:

According to the excerpt, the majority of workers in India are self-employed.

Correct Answer: False

Solution:

In recent years, the growth of employment has decelerated.

Correct Answer: True

Solution:

According to the excerpts, about 60% of urban workers are employed in the service sector.

Correct Answer: False

Solution:

In recent years, the growth of employment has decelerated.

Correct Answer: True

Solution:

The Act provides 100 days of guaranteed wage employment to rural households willing to do unskilled manual work.

Correct Answer: True

Solution:

The excerpts mention that technology used in the informal sector enterprises is outdated and they do not maintain any accounts.

Correct Answer: False

Solution:

About three-fifth of India's workforce depends on agriculture and other allied activities as the major source of livelihood.

Correct Answer: True

Solution:

The excerpts state that about 60% of the urban workers are engaged in the service sector.

Correct Answer: True

Solution:

About three-fifth of India's workforce depends on agriculture and other allied activities as the major source of livelihood.

Correct Answer: True

Solution:

About 60 percent of urban workers are in the service sector.

Correct Answer: False

Solution:

In recent years, the growth of employment has decelerated, and there have been fluctuations.

Correct Answer: True

Solution:

In India, the government plays a significant role in providing formal sector employment through various departments and public sector enterprises.