{"id":37496,"date":"2025-02-17T19:16:08","date_gmt":"2025-02-17T13:46:08","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=37496"},"modified":"2025-02-19T13:00:34","modified_gmt":"2025-02-19T07:30:34","slug":"changing-employment-sector-in-india","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/current-affairs\/17-02-2025\/changing-employment-sector-in-india","title":{"rendered":"Changing Employment Sector in India"},"content":{"rendered":"\n<p><strong>Syllabus: GS3\/Economy<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Context<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The trend of organised employment has been shifting from the public to private sector \u2014 especially post the economic reforms of 1991.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>About<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>India\u2019s middle class after Independence was largely created by the<strong> public sector.<\/strong><\/li>\n\n\n\n<li>Employment in the public sector stood at 194.7 lakh and that in the organised private sector only at 80.6 lakh in 1995.\n<ul class=\"wp-block-list\">\n<li>The employees in the central and state governments plus quasi-governments (public sector undertakings) and local bodies \u2014 fell to 176.1 lakh and the latter rose to 119.7 lakh by 2012.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Major Trends<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Regular employees with the Indian Railways: <\/strong>Between 1990-91 and 2022-23, these plunged from 16.5 lakh to 11.9 lakh.<\/li>\n\n\n\n<li><strong>Employees in the IT Sector: <\/strong>Tata Consultancy Services (TCS) and Infosys already had 45,714 and 36,750 employees respectively at the end of 2004-05, which rose to 4,48,464 and 2,42,371 fifteen years later.<\/li>\n\n\n\n<li><strong>Banking sector transformation:<\/strong> In 1991-92, of the total employee strength of the scheduled commercial banks in India the Public sector banks had a share of <strong>87%.<\/strong>\n<ul class=\"wp-block-list\">\n<li>At the end of 2023-24, the private employee strength was 8.74 lakh, as against the less than 7.5 lakh of public sector banks.&nbsp;<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full is-resized\"><img data-dominant-color=\"dfdedc\" data-has-transparency=\"false\" loading=\"lazy\" decoding=\"async\" width=\"600\" height=\"584\" src=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/02\/Changing-Employment-Sector-in-India.png\" alt=\"changing face of employment\" class=\"not-transparent wp-image-37502\" style=\"--dominant-color: #dfdedc; width:462px;height:auto\" srcset=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/02\/Changing-Employment-Sector-in-India.png 600w, https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/02\/Changing-Employment-Sector-in-India-300x292.png 300w\" sizes=\"auto, (max-width: 600px) 100vw, 600px\" \/><\/figure>\n<\/div>\n\n\n<h2 class=\"wp-block-heading\"><strong>Reasons for the Transformation of Working Middle Class in India:<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Economic Liberalization: <\/strong>Post-1991 reforms opened up the economy, leading to the growth of the private sector and more job opportunities.<\/li>\n\n\n\n<li><strong>Higher Salaries and Benefits:<\/strong> The private sector often offers better pay, career growth, and benefits compared to public sector jobs, attracting the middle class.<\/li>\n\n\n\n<li><strong>Improved Work Culture:<\/strong> It provides a more dynamic and performance-driven environment, which appeals to the ambitious working middle class.<\/li>\n\n\n\n<li><strong>Limited Public Sector Jobs: <\/strong>The growth of public sector jobs has stagnated, and competition for these positions is high, making private sector jobs more attractive.<\/li>\n\n\n\n<li><strong>Entrepreneurial Opportunities:<\/strong> The rise in entrepreneurial ventures and startups has encouraged the middle class to shift towards private businesses and self-employment.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Challenges faced by India<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Employment in the Agriculture Sector: <\/strong>India has not experienced structural transformation of surplus labour from agriculture to other sectors.\n<ul class=\"wp-block-list\">\n<li>As per the Periodic Labour Force Surveys (PLFS) farm sector\u2019s share in India\u2019s workforce decreased from 64% in 1993-94 to 42.5% in 2018-19, but is subsequently going up to 46.2% in 2023-24.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Most services sector jobs are informal and low-paying:&nbsp;<\/strong>\n<ul class=\"wp-block-list\">\n<li>India with <strong>almost 85% informal labour <\/strong>is generating more than half of the country\u2019s GDP.<\/li>\n\n\n\n<li>A high proportion of <strong>socially and economically underprivileged sections<\/strong> of society are concentrated in informal economic activities.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Reasons for Increase in the Share of Informal Sector in India\u2019s Employment:<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Unskilled Labour: <\/strong>The education system emphasises theoretical knowledge over practical proficiency. This approach renders new graduates ill-prepared to meet industry demands.&nbsp;&nbsp;<\/li>\n\n\n\n<li><strong>Rural-Urban Divide: <\/strong>Inaccessible areas are hardly getting quality programmes for their training and industry exposure.&nbsp;<\/li>\n\n\n\n<li><strong>Technological Changes:<\/strong> The rise of gig economy platforms and casual labor opportunities has expanded the informal sector.<\/li>\n\n\n\n<li><strong>Flexibility:<\/strong> Many workers prefer the flexibility of informal work, even though it lacks benefits like healthcare and pensions.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Challenges Related to Informal Sector in India<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Low Wages and Exploitation:<\/strong> Informal employment, by definition, lacks a written contract, paid leave, and hence does not pay minimum wages or pay attention to working conditions.<\/li>\n\n\n\n<li><strong>Lack of Social Security:<\/strong> Workers in the informal sector often lack access to social security benefits such as healthcare, pensions, and unemployment insurance.&nbsp;<\/li>\n\n\n\n<li><strong>Limited Access to Finance:<\/strong> Informal sector workers and businesses often struggle to access formal financial services such as bank loans and credit.<\/li>\n\n\n\n<li><strong>Poor Quality of Life: <\/strong>Unorganized sector workers were far more likely to be poor than their organised sector counterparts.&nbsp;<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Way Forward<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Bridging the Gap in Education: <\/strong>Aligning Education with Industry Demand Changes will prepare students for real-world challenges.&nbsp;<\/li>\n\n\n\n<li><strong>Government Initiatives: <\/strong>The programmes can focus on areas like installation of solar energy, <a href=\"https:\/\/www.nextias.com\/blog\/waste-management-in-india\/\" data-type=\"link\" data-id=\"https:\/\/www.nextias.com\/blog\/waste-management-in-india\/\"><strong>waste management<\/strong><\/a>, and precision agriculture.\n<ul class=\"wp-block-list\">\n<li>Public-private partnerships in the green sector can ensure that such training is relevant and impactful.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Strengthening Rural Skilling Initiatives: <\/strong>Leveraging technology to scale online platforms can ensure equitable access to quality education.<\/li>\n\n\n\n<li><strong>Incentivising for Retention of Employees: <\/strong>Offering tailored upskilling programmes, encouraging inclusive work cultures, and having mental health support can enhance employee satisfaction and retention.<\/li>\n<\/ul>\n\n\n\n<p><strong>Source: <\/strong><a href=\"https:\/\/indianexpress.com\/article\/explained\/explained-economics\/middle-class-changing-employment-sector-in-india-and-its-one-big-challenge-9839657\/\" rel=\"nofollow noopener\" target=\"_blank\"><strong>IE<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The trend of organised employment has been shifting from the public to private sector \u2014 especially post the economic reforms of 1991.<\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-37496","post","type-post","status-publish","format-standard","hentry","category-current-affairs"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/37496","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=37496"}],"version-history":[{"count":3,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/37496\/revisions"}],"predecessor-version":[{"id":37623,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/37496\/revisions\/37623"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=37496"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=37496"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=37496"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}