Social Scientist. v 19, no. 218 (July 1991) p. 39.


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NOTE/ SUZAN HAZRA*

Employment in India's Organised Sector**

Historically the process of economic growth of countries, sustained over a significant time horizon, has coincided with a perceptible shift in the occupational structure of labour force. One of the forms which it takes is a shift in the work force away from the informal to the formal sector.

However, during the initial phases of development, the increase in the share of the non-agricultural sector in the GDP of the country is much faster than the increase in the share of the non-agricultural sector in total employment. Indeed, in the Indian case, the proportionate shift of workers out of agriculture did not take place for many years after the decline in the share of agriculture in GDP had gotten well underway. This lag tends to be large when the country undergoing the process of development is starting from a very low non-agricultural base. In short, a lag between the increase in the contribution of the non-agricultural sector to GDP and the increase in the share of employment in non-agriculture is likely in the case of developing countries during the early phase of their development. However the increase in the share of the non-agricultural sector in the GDP of the country is not itself sufficient to ensure a perceptible change in the occupational structure in favour of the non-agriculture even with a long time lag. The nature of change in product and financial markets, government policies, the choice of technique in various sectors and so on are important forces that underlie and sustain such an occupational shift.

In the case of developing countries like India it can be argued that the problems of unemployment,un4eremployment and disguised unemployment in agriculture are much more acute than the problems of

* Research scholar. Centre for Economic Studies, Jawaharlal Nehru University, New Delhi.

** The author deeply indebted to Prof. Shella Bhalla for her constant help and suggestions during various stages of this artide.

Social Scientist, Vol. 19, No. 7, July 1991



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