Author: Naman Sharma
Employment refers to the state of being engaged or hired by an individual, organization, or company to perform work or tasks in exchange for financial compensation like wages and salaries. It includes full-time, part-time, temporary, and freelance positions, and plays a crucial role in providing livelihood and economic stability to individuals in the society.
Employed people are further engaged in two types of sectors namely organized sector and unorganized sector.
Sectors In Employment: -
Employment sectors are typically categorized into organized and unorganized sectors. Organized sectors include industries with structured labour laws, such as government, corporate, and formal private sectors. Unorganized sectors include informal labour, often lacking job security or benefits, like agriculture, small-scale enterprises, and daily wage labour, making up a significant portion of developing economies.
More About Unorganized Sector : -
The unorganized sector, in economic terms, refers to a segment of the workforce that operates outside the provisions of formal labour regulations and lacks the benefits and job security associated with organized or formal employment. This sector predominantly includes activities like street vending, small-scale agriculture, home-based work, and daily wage labour in construction and manufacturing. Workers in the unorganized sector often face dangerous employment conditions, low wages, limited access to social security, and minimal legal protections.
Despite its informality, the unorganized sector plays a vital role in many economies, especially in developing countries, and is a significant source of employment for a substantial portion of the population.
In India a significant amount of worker population is indulged in unorganized sector. This is because Low level of education and poor access to land denies workers access to good jobs in organized sectors.
As per the Economic Survey, 2021-22, total number of people working in the unorganized sector is around 43.99 crores during 2019-20.
In terms of employment share the unorganized sector employs 83% of the work force and 17% in the organized sector. There are 92.4% informal workers (with no written contract, paid leave and other benefits) in the economy. There are also 9.8% informal workers in the organized sectors indicating the level of outsourcing. Among the 83% of workers in unorganized sector 50% is from agriculture industry alone.
Exploitation & Negatives: -
Unorganized sector workers often face numerous challenges and negatives, including exploitation, due to the informal and unregulated nature of their employment:
Low Wages: Unorganized sector workers typically earn lower wages than workers in organized sector. Many are paid daily or piece-rate wages, which are often insufficient to cover basic living expenses.
Lack of Job Security: Job security is almost non-existent in the unorganized sector. Workers can be laid off without notice, making their livelihoods highly uncertain.
Absence of Benefits: Workers in the unorganized sector often lack access to essential benefits like health insurance, retirement plans, paid leave, and other social security benefits.
Unsafe Working Conditions: Occupational safety and health standards are often disregarded in the unorganized sector, leading to unsafe working conditions and a higher risk of accidents and injuries.
Long Working Hours: Many unorganized sector workers are forced to work for long hours, including overtime, with little or no compensation for extra time worked.
Lack of Legal Protections: These workers have limited legal protections and are often unaware of their rights. Exploitative employers take advantage of their vulnerability.
Child Labour and Bonded Labour: The unorganized sector is notorious for employing child labour and bonded labour, which is illegal but persists due to poverty and lack of enforcement.
Limited Access to Education: Children of unorganized sector workers often have limited access to education.
Gender Discrimination: Women in the unorganized sector face additional challenges, including wage discrimination and lack of maternity benefits.
No Collective Bargaining: Unlike organized sector workers who can collectively bargain for better conditions, unorganized sector workers often lack the power to negotiate collectively.
Health Risks: Many unorganized sector jobs involve exposure to hazardous substances, leading to long-term health issues.
Debt Traps: Some workers, especially in agriculture, fall into debt traps due to borrowing money at exorbitant interest rates to meet their basic needs.
Lack of Social Mobility: The lack of opportunities for skill development and upward mobility can trap unorganized sector workers in poverty for generations.
Inequality: The income disparity between organized and unorganized sector workers contributes to overall economic inequality in a society.
How to Help People Come Out of This Sector: -
Helping individuals to come out from the unorganized sector to the organized sector is a complex task. It requires a multifaceted approach. Skill training programs should be tailored to the organized sector's needs, enhancing employability. Access to formal financial services, such as microfinance and credit, can empower individuals to invest in income-generating activities. Labour rights and protections must be strengthened to ensure fair wages and job security in the organized sector. Expanding social safety and extending education opportunities can provide a safety net and break the cycle of poverty. Additionally, offering incentives for formalization and facilitating job placement services can bridge the gap between the two sectors. Awareness campaigns, public-private partnerships, and regional development initiatives play vital roles in facilitating this transition. Through concerted efforts, societies can empower unorganized sector workers to access better job opportunities, economic stability, and improved livelihoods in the organized sector.
Different strategies that can be adopted to move people out from unorganized sector are: -
Skill Development
Promote Entrepreneurship
Access to Education
Job Placement Services
Awareness Campaigns
Public-Private Partnerships
Regional Development
To know more you can visit to the below mentioned link: -
Great read