Mental Health of Informal Workers

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October 11, 2023

Why in news?

Informal workers, despite their significant contribution to national income, are perennially exposed to economic, physical, and, in turn, mental vulnerabilities.

Status of Informal workers

  • Global- Around 2 billion (61.2%) of the world’s employed population worked informally in 2016.
  • This proportion was relatively higher for emerging and developing countries at 69.6%.
  • India- India’s informal workforce accounts for more than 90% of the working population.
    • Urban- 79% of total jobs
    • Rural-96% of total jobs
  • 95% of India’s working women are engaged in informal sector.

Who are informal workers?

  • Informal employment- It broadly refers to workers who are employed in jobs where they do not have access to social security benefits under existing labour legislations.
  • They are private unincorporated or unregistered enterprises, owned by households or individuals.
  • This can be either because of the informal nature of the enterprise where a person is employed, or due to the nature of the work itself, which can be casual, part-time, or home-based self-employment.

Steps taken to formalize the Informal Sector

  • e-shram portal- It was developed in 2021 to create a National Database of Unorganized Workers (NDUW) for optimum realization of their employability and to extend the social security benefits.
  • Pradhan Mantri Shram Yogi Maan-dhan Yojana- It was launched in 2019 to protect unorganized workers like street vendors, agriculture related work, construction site workers etc.,
  • Pradhan Mantri Rozgar Protsahan Yojana- It was launched in 2016 to create employment for the unskilled or semi-skilled workers by providing incentives to the employers.
  • Rashtriya Swasthya Bima Yojana- It was launched in 2008 to provide socio-economic security to the BPL workers by providing them with health insurances
  • Gatidhara Scheme- It was launched by the West Bengal transport department for giving employment to the youth who has registered themselves as unemployed.
  • Garib Kalyan Rozgar Yojana- It was launched in 2020 during COVID-19 to promote employment opportunities for migrant workers.
  • PM Street Vendor’s Atma Nirbhar Nidhi (PM SVANidhi)- It was launched in 2020 to provide affordable working capital loan to street vendors to resume their livelihoods that have been adversely affected due to Covid-19 lockdown.

Why informal workers face mental health issues?

A study by the International Labour Organization (ILO) says that 15% of working-age adults, globally, live with a mental disorder.

  • Mental health- Unemployment, unstable or precarious employment, workplace discrimination, etc. can all pose a risk to a worker’s mental health.
    • As per United Nations Development Programme (UNDP), unemployment and poor-quality employment have consistently been detrimental to mental health
  • Psychological risks- Workers in low-paid, unrewarding or insecure jobs, or working in isolation, are more likely to be exposed to psychosocial risks, thus compromising their mental health.
  • Safety risk- Working in unsafe working environments, enduring for long hours, little access to social or financial protections, etc. add to the issue.
  • Patriarchy- The structures and practices in social and familial spaces put women without social protection.
    • The State of Inequality in India Report 2022 observes that the unemployment rate actually increases with educational levels, particularly for educated young women who show an unemployment rate of 42%
  • Negative emotions- Youth unemployment is one of the highest in India which, along with the stigma around unemployment, significantly impacts their mental health.
    • Centre for the Study of Developing Societies’ survey among 9,316 youth aged between 15 to 34 years in India has shown that they are highly susceptible to negative emotions.
  • Old age- The absence of proper financial and health-care security among the working elderly can severely impact their physical and mental health, aggravating their vulnerability.
    • The Census of India 2011 shows that 33 million elderly people are working post-retirement in informal work.

The theme of World Mental Health Day (October 10) 2023 is ‘Mental Health as a Universal Human Right’.

How the lack of social security impact the mental health of informal workers?

  • Mental distress- Informal workers face mental distress due to accumulating debt and rising health-care costs, which are intertwined and mutually reinforcing.
  • Post COVID- A study by Women in Informal Employment: Globalizing and Organizing (WIEGO) among informal workers in Delhi, mostly migrants, indicates that recovery post COVID-19 remains uneven among informal workers  
  • Basic necessities- Mental health and well-being are impacted by factors such as food security, access to livelihood and financial stability.
  • Lack of funding- Schemes such as the Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS) have seen their funding slashed in this Budget.
  • Code on Social Security 2020- The current Code on Social Security does not universalise social security.

In 2021, the National Crime Records Bureau (NCRB) reported that 26% of the people who died by suicide were daily wage earners.

Initiatives taken to tackle Mental Health Related Issues

  • National Institute of Mental Health and Neurosciences (NIMHANS), Bengaluru
  • National Mental Health Programme (NMHP), 1982
  • Mental Health Act, 2017
  • National Mental Health Policy, 2014
  • KIRAN mental health helpline, 2020
  • Tele-MANAS helpline, 2022

What lies ahead?

  • India need to increase budgetary allocation for mental health, currently it is 1% of total health budget.
  • World Mental Health Report 2022 observed, addressing mental health involves strengthening community-based care, and people-centred, recovery-oriented and human rights-oriented care.
  • There is an urgent need for proactive policies to improve mental health recognition and action.
  • Mental health is critical in upholding the basic human right to good health, including mental health, and in advancing to the Sustainable Development Goals (SDGs) especially
    • SDG 3- Good health and well-being
    • SDG 8- Decent work for all/ economic growth



  1. The Hindu- Mental health and informal worker
  2. Oxfam- Glance at Informal Workers
  3. Vikaspedia- Formalising the informal sector
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