Labour force

Classification of Occupational
Labour Force
by
Dr. K. Murugan
Assistant Professor
Department of Economics
Guru Nanak College
Chennai-42.

Occupational Pattern in India
Labour force is defined as those able-bodied
workers in the age group of 15 to 59.
The proportion of working population to total
population is called work participation rate. In
Underdeveloped Countries (UDC’s) the work
participation rate of labour force is low.
According to 1981 census, the work
participation rate in India was 36.7 percent. In
1991, it increases to 37.7 percent..

According to 2001 census, the work
participation rate increased to 39.2 percent. It
means out of our total population of 102.7
crore, about 40 crore people constitute the
work force.
In 1991, out of total population of 84.6 crore,
about 32 crore people constituted the labour
force. From 1901 to 1970, there was no change
in the occupational pattern especially in
primary sector agriculture and allied activities.
In 1901, 71.7 percent of the labour force was
engaged in primary sector.

In 1971, almost the same proportion (72.2%) of
the labour force was in agriculture only in 1981
there has been small decrease in the proportion of
work force engaged in agriculture.
In 1991, 66.8 percent of the labour force was
employed in agriculture. A recent estimate shows
that 56.7 percent of our labour forces are
employed in agriculture. This slow decrease in the
proportion of work force employed in agriculture
in the reference of increasing population growth
shows large disguised unemployment in Indian
agriculture.

In secondary and tertiary sector. 27.9 percent
of the labour force was employed in secondary
and tertiary sector till 1971.
In 1951, 10.7 percent was engaged in
industrial sector which slightly increased to
12.7 percent in 1991. NSS estimate shows that
in 1999-2000, 17.5% was engaged in
secondary sector. In second plan huge
investment was made to industrialise economy.
This had put a small effect on the occupation
structure of the country.

While analysing the rate of labour employment in
tertiary sector, it is found that 17.2 percent was
engaged in this sector in 1951. During the period
of 1st six plans the situation remained unchanged.
In 1981, 17.7% was employed in tertiary sector.
Only in 1991, this ratio has gone up to 20.5
percent and in 1999-2000, it increased to 25.8
percent.
After the satisfaction of basic needs like food,
clothing and shelter which directly come from
agriculture and industry, people demand various
kinds of services like health education, travel,
transport, banking and insurance etc.

With the development of a large middle class
in India, the share of service sector to GDP and
ratio of work force engaged in tertiary sector
are supposed to increase.
There is no visible shift in the labour force
from the primary to the secondary and tertiary
sectors in India during twentieth century. The
economic development is associated by a shift
of the working population from the primary to
the secondary and then to the tertiary sector.

Labour Market in India
Structure of the Labor Market in India is made
up of multiple layers. According to
Government laws, classification of the labor
sector is done on the basis of skill and area of
operation are given below.
Unskilled
Semi-skilled
Skilled
Highly skilled
Managerial personnel

Classification of Labour Force in India
Labour force in India can be divided into
organized and unorganized sectors.
Unorganized Sector
The Government of India is very keen on
reforms in Indian labor sector by providing
legal and social protection to the unorganized
and informal sector workers. However the
major problem is no one is absolutely clear
about the informal workforce in India.

According to Economic Survey (2018-19) 93
percent of the total workforce is informal sector.
NITI Aayog report (2018), 85 percent of the
workforce in India is employed in the informal
sector.
National Statistical Commission (2012) report of
the Committee on Unorganised Sector Statistics,
the informal workforce is more than 90 percent
of the total workforce.
Organized Sector: This sector workers are
employed in Government organizations, state
owned enterprises, private sector companies.

 Occupation: It includes fishermen, landless
agricultural labourers, small & marginal farmers,
construction workers, beedi rolling, weavers,
workers, packing & labeling, workers in animal
husbandry etc,
 Nature of Employment: Migrant workers, Casual
labourers, Contract labourers, Bonded and
agricultural labourers.
 Specially Distressed Categories: Scavengers, toddy
tappers, loaders, unloaders etc.
 Service Categories: Domestic workers, vegetable
vendors, fruits vendors, pavement vendors,
newspaper vendors, hand cart operators.

 Occupational Distribution
 A sharp decline in cultivators
 Total workforce is still tilted towards agricultural
activities, more than half of the workforce is
concentrated in agriculture.
 8.9 million farmers, during 2001 and 2011, moved
away from self-cultivation in the total work force.
The decline in main workers who involved in
cultivation/ farming had begun since 1991. Around
7.5 million farmers of main workers category during
1991-2001 and another 7.4 million during 2001-11,
together

 14.9 million farmers of main workers category are
moved away from farming during the last two
decades. There was a decline in main workers
involved in self-cultivation during 1991-2001, 10.4
million workers newly entered into farming as
marginal workers.
 2.9 million workers into farming activity during
1991-2001. Later, during 2001-11, along with farmers
in the main workers category (7.4 million) farmers of
marginal workers category (1.5 million) also moved
away from farming activity. Thus, there is a total
decline of 8.9 million farmers during 2001-11.

Farmers becoming agricultural labourers
The farmers moving away from self-
cultivation to agriculture labour. There is more
than compensating size increase (to decline in
farmers) in the category of agricultural
labourers. It is about 36.9 million net additions
to the size of agriculture labourers during
2001-11.
When compared that the decline in workforce
engaged in self-cultivation at 7.4 million, is
very small. Most of those farmers who are
moving away from farming are becoming
agricultural labourers.

 In agricultural labour, the main workers when male
and female workers are combined, its size had in fact
declined during 1991-2001. But thereafter it
increased between 2001 and 2011.
 In marginal worker the number of workers (male and
female combined) engaged in agriculture labour has
increased since 1991.
 The rate of growth in agriculture labourers is
significantly higher among the marginal workers
category of males than the rate observed for male
main workers category during 2001-11.

Labour force absorption in non-agriculture
– increasing
During 2001-11, 79 million is the net addition
to the total workforce. Of the total net addition
one–third of it is absorbed in the agriculture
and the rest in the non-agriculture. There is
increasing labour force is getting absorbed in
non-agriculture. Relatively higher growth of
workforce engaged in non-agriculture when
compared with the agriculture.

 The rate of growth in the total workforce engaged in
non-agricultural activities is distinctively high and
different from that of agriculture, particularly during
1991-2001. Nevertheless, this high growth rate in non
agriculture has decelerated, during the recent decade
(2001-11), to around half-of the rate that recorded in
the previous decade (1991-2001).
 As a result the considerable change in the structure of
workforce towards non-agriculture observed in 1990s
is reduced in 2000s. This is in contrast to the growth
of GDP in India in its non-agriculture sector that had
registered its highest ever during 2001-11.

 Growing Female workforce in Non-agriculture
 Growth among the female workers engaged in non
agriculture is found to be higher than their male
counterparts. The pattern of workforce engaged in
nonagriculture sector, most of it is moving towards
unorganized and informal sectors particularly the
labour-intensive businesses.
 The availability of female labour at cheaper wage
rates might be the inducing factor for the preference
of women workers over men. It may raise the concern
over the quality of the females’ employment in non-
agriculture.

 As a result the share of marginal workers in the total
female workforce engaged in non-agriculture is
increasing over time.
 In 2011, one-third of the total female workforce
engaged in non-agriculture is in the category of
marginal workers.
 Increasing Marginal category in the Non-
agricultural Workforce
 The share of marginal workers in the total workforce
engaged in the non-agriculture is increasing since
1990s. There is increase in the share of marginal
workers is even observed for total male workers
engaged agriculture. Among the non-agriculture
workers, increasing share of marginal is observed for
both the male and females.

Diminishing rate of Absorption of Labourforce
in HHI
It is an important source of livelihood for a
considerable large proportion of workforce.
Around 6% of female workforce and 3% of male
workforce, together 4% of total workforce in
India, in 2011, is engaged in household industry.
Growth of workforce in household industry is fast
decelerating during the last decade (2001-11). It
has registered a rate of growth 1.1% per annum
during 2001-11 In fact, there was a decline in the
workforce engaged in household industry during
1981-91. Thereafter, during 1991- 2001,
workforce in the HHI registered a significantly
higher growth.

Gender Distributions
There is recent changes in growth and changing
structure of workforce in India. Females share a
half of the total population, only one-quarter of
the main status workers are female but little more
than half of the marginal status workers are
females.
Female’s share in the population has shown a
marginal increase since 1991 continued the
increase till 2011. Females’ representation in the
main workers has increased during 2001-11, but
their representation has declined among the
marginal workers.

Their share in the in the total workforce
increased between 1981 and 2001 and
thereafter it has shown a marginal decline. But
their share in main workers increased
throughout during the last three decades -
between 1981 and 2011. The decline in their
share in total workforce is entirely to due to
decline of their share in the marginal workers
which has shown a fast decline since 1991.

 In the traditional occupations such as agriculture
(incl. self-cultivation and labour) and household
industry, female’s representation is declining. Among
the three occupations: cultivators, agricultural
labourers and HHI, the female’s share had increased
between 1981 and 2001 thereafter it declined between
2001 and 2011.
 In the in modern occupation their representation is
getting increased. In the workforce engaged in
‘others’ occupation, which include non-household
industry

Labour force

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