Occupational Structure

Occupational Structure: All economic activities in a country can be divided into three broad sectors—the primary sector, the secondary sector, and the tertiary sector.

The primary sector includes agriculture and allied activities, fisheries, and forestry. The secondary sector includes various manufacturing activities. The tertiary sector comprises various services such as transport, banking, and insurance.

Occupational Structure in India

In India, the primary sector employs 60% of the total workforce. Meanwhile, the proportions of the total workforce engaged by the secondary and tertiary sectors are 16% and 24% respectively. Thus, the majority of the population depends on the primary sector for livelihood.

In rural areas, nearly three-fourths or 75% of the workforce engages in agriculture and allied activities. On the other hand, only 11% and 13% of the rural workforce engage in activities related to manufacturing and services, respectively. Moreover, the proportion of rural women engaged in the primary sector is more than the proportion of rural men employed in the same sector. Widespread poverty in rural areas compels more women to participate in farm activities to support the livelihood of their families, even when these activities are low-paying.

In urban areas, the services sector employs 59% of the workforce, while the primary sector accounts for just 10% of the workforce.

Growth and Change in Occupational Structure in India

As seen in the case of various developed countries, with growth and development, the workforce shifts first from the primary sector to the secondary sector and then from the manufacturing sector to the tertiary sector. However, in India, there has been only a modest change in the occupational structure over the years.

The primary sector still employs the largest proportion of the workforce in the country. Between 1972–73 and 1999–2000, the share of the primary sector in the workforce declined only marginally from 74% to 60%. Meanwhile, the shares of the secondary and tertiary sectors increased from 11% to 16% and from 15% to 24% respectively.

The workforce distribution indicates that from 1972 to 2000, there has been a shift from self-employment and regular salaried employment to casual wage employment. This pattern of more people becoming casual wage workers rather than self-employed and regular salaried workers is termed as casualization of the workforce.

Thus, we can conclude that while changes in the distribution of the workforce have taken place, the industrial and services sectors need to increase their share in the workforce distribution by generating more employment opportunities and absorbing excess labor from the agricultural sector.

Jobless Growth

Economic growth implies growth in GDP, i.e. growth in the aggregate output produced during an accounting period within the domestic territory of an economy. Over the years, India has experienced positive growth in GDP.

However, the rate of growth of employment has remained low as compared to the rate of growth of GDP. This suggests that the growth process in India has been unable to generate employment opportunities. In other words, there has been a rise in GDP without a simultaneous rise in the employment rate. This is referred to as jobless growth.

The prime reason for jobless growth is that the growth in GDP has been brought about by employing modern and improved technology which has substituted labor with machines. Consequently, the industrial and services sectors have failed to generate new employment opportunities to absorb the excess labor from the agricultural sector.

Thus, the agricultural sector continues to suffer from disguised unemployment along with low levels of productivity and massive poverty.

In addition to this, multi-national corporations (MNCs) that played an important role in India’s economic growth, provided employment only to the educated and technically skilled part of the workforce. These MNCs relied on modern and efficient technology rather than labor for the production of goods and services.

As a result, the employment level has remained low. Over time, the gap between GDP growth rate and employment growth rate has widened to make the situation worse.

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