What is the issue?
The nature and extent of the employment in India are barely understood in the absence of information on unorganised sector workers.
What is the background?
- India do not have a reliable official database on certain aspects of the labour market and industrial relations such as employment, strikes and lockouts.
- The current scenario of employment in India has transformed from a long term employment to fixed short term engagement in the form of contracts.
- This has created a need for an official employment database to capture these significant changes.
- Several official agencies collect data on employment/unemployment with differing definitions and classifications of workers and with different frequencies (decadal to annual/quarterly).
- Private sector data sets and proxy data sets (payroll data) have also emerged to capture these employment pattern changes.
What are the problems with official calculations?
- Manufacturing sector - The Annual Survey of Industries (ASI) collects employment data annually on workers/employees from the establishments covered under the Collection of Statistics (COS) Act, 2008.
- The employment data relates to directly employed workers, contract workers, supervisory and managerial staff and other employees.
- Directly employed workers comprise both permanent workers and non-permanent workers including non-statutory apprentices/trainees and fixed-term employees (FTE).
- There is a possibility that some of the directly employed workers are being indulged in per hour work or a part time work, with wages even less than the contract workers.
- But there is no further classification on the nature of employment i.e., based on hours - part time or full time.
- All directly employed workers are being equated as ‘regular/permanent workers’ and only the contract workers are treated as the flexible category.
- This shows that there is a gross underestimation of flexible workers reported in the official data.
- Also, the ASI primarily covers the registered manufacturing sector, leaving out the unorganised or unregistered or informal sector enterprises.
- Service sector – Data related to this sector comes under the State-level Shops and Establishments Acts.
- A reliable data set on the service sector has not been established, mainly because of lack of data submissions from the state labour departments(SLD).
- Thus, the Labour Bureau should compile and provide sector-wise data of the SLDs under its control.
What should be done?
- India’s labour market governance is at peril as there is a serious information deficit on unorganised sector workers in the country.
- It is imperative that the government takes measures to design afresh a statistical system reflective of dynamics of changes in the labour market.
Source: Business Line
