Revive India’s unorganized sector to raise incomes and tackle unemployment

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₹238,168 with OAEs reporting only 127,073 per unit. That means 85% of unorganized-sector enterprises were generating around ₹10,000 per month. The situation for hired workers was no better.

Average emoluments for hired workers in informal enterprises that had such recruits was ₹124,842 per annum, or around ₹10,000 per month. Again, we saw significantly higher growth in emoluments between 2010-11 and 2015-16, but a real decline in emoluments per worker between 2015-16 and 2022-23. These trends from ASUSE surveys are not surprising, given that data from many other sources has also suggested that the unorganized sector has not seen any growth in its size either in terms of the number of establishments or count of workers employed.

So is the case with incomes being generated by the sector. These have seen a real decline on almost all relevant indicators, be it GVA or the earnings of hired workers. In fact, these confirm the trend of a decline in the real earnings of regular workers observed in the NSO’s employment surveys and a decline in real wages recorded by the labour bureau.

Several other indicators of the operational and economic characteristics of enterprises also suggest very low or no improvement in conditions. Only 6% reported using computers, marginally higher than the 5% who reported using them back in 2015-16. The sector’s situation in terms of access to capital in general and credit in particular also suggests that these small businesses remain outside the purview of most government schemes.