Shaping the informal employment sector with skill development is the need of the hour

Shaping the informal employment sector with skill development is the need of the hour

Revamping the agriculture sector and modifying labour laws are a few measures that could help the informal employment sector in Maharashtra.

Much has been said about India’s demographic dividend and the supposed resultant economic growth. However, without appropriate education and skill training, this advantage will be rendered useless. “It is the policies of the government which will determine if it is a dividend or disaster,” said Devendra Fadnavis, Chief Minister of Maharashtra, in his keynote address at a seminar conducted by the Tata Institute of Social Sciences (TISS) on informal employment in the State.  

A paper presented on the topic by Bino Paul, Faculty Member, TISS, classified employed persons without any social entitlements like provident fund, pension, insurance, medical claim, maternity benefits as informal. As per the paper, more than 95 per cent of the employment in economic activities like agriculture and construction was informal. Considering that both these sectors account for more than 50 per cent of the total employment, it infers that the informal working force represents a significant chunk of population.

“When you look at the trickle down of benefits, we are engaging nearly 45 per cent people in agriculture, but not giving employment. We need to provide social security and improve living standards,” said Fadnavis.

This informal employment sector is expanding and encroaching into other spheres as well. “Today even employees from the formal and even government sector are falling into the informal sector,” said Kapil Patil, Member of Legislative Council, Maharashtra.

According to Fadnavis, as far as the agricultural sector is concerned, the government needs to provide real employment by enhancing productivity and creating value chains. He also emphasised the importance of skill development.

“Half of the skill development centres in China are dedicated to agriculture. As a result, despite having lesser cultivable land and irrigation potential, bad climate and terrain as compared to India, their productivity is twice as much,” he said.

The Chief Minister also spoke about the manufacturing sector wherein the labourers need to be protected from exploitation, and provided with social security through a change in labour laws.

According to him, the major issue is that most stakeholders hesitate to look into the real problems. “In our country when you talk about labour laws, it is perceived that you are anti – labour and pro–industry,” he said. As per him, the focus must be on expanding the labour market and protecting the labourer at the same time. “Right now the labour laws protect only bureaucracy. It is time to look at these laws from a fresh perspective,” he added.

While a structure for improving tertiary education and skill development quantitatively and qualitatively emerged as possible solutions to help formalise the informal sector, T Muralidharan, Founder, TMI Group mentioned that employment factors are not always driven by logic.

“In addition to the employed and unemployed, there is also a sizeable section of willingly unemployed people,” he said. According to Muralidharan, these people do not find the compensation commensurate with their educational qualifications and thus choose to remain unemployed. “Compensation is probably the most mismanaged instrument of policy. Instead of improving these conditions, we keep trying to find a relation between growth in GDP and employment, when there is none,” he added.

While different speakers at the seminar spoke of methods and ideas to ensure inclusive development, a need to be flexible with policy formulation was the common undertone.

“Ideology is good. But it needs to be blended with realism. Without realism, ideologies are illusions,” signed off Fadnavis.

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