Labour law reforms: In absence of reliable statistics on its size, distribution or contribution to the economy, the sector remains a poorly understood and a grossly neglected area.
Providing legal and social protection to the informal or unorganised sector workers — one of the key objectives of the labour law reforms being planned may be easier said than done. The challenges are many and the government seems least prepared.
For one, no one even knows the actual size of the informal workforce, least of all the government.
Size and contribution to GDP
The Economic Survey of 2018-19, released on July 4, 2019, says “almost 93%” of the total workforce is ‘informal’. But the Niti Aayog’s Strategy for New India at 75, released in November 2018, said: “by some estimates, India’s informal sector employs approximately 85% of all workers”.
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What is the source of such information? The Economic Survey of 2018-19 does not mention it. The Niti Aayog does and cites a 2014 report, ‘OECD India Policy Brief: Education and Skills’, which, in turn is silent on its source of information.
There is yet another government report, ‘Report of the Committee on Unorganised Sector Statistics’ of the National Statistical Commission (NSC), 2012, which says the share of the informal workforce is “more than 90%” of the total. Again, there is no mention of the source.
So is the case with its contribution to the economy. The government does recognise that the informal sector and workers contribute significantly. The NSC’s 2012 report pegs it at “about 50% of the national product” without revealing how it arrived at such a conclusion.
Source: Business Today