1. Articles
  2. Human Resources
  3. Welfare of the Unorganized Sector in India: The Prime Responsibility Articles

Welfare of the Unorganized Sector in India: The Prime Responsibility

Published by MBA Skool Team in Human Resources Articles category Last Updated: July 15, 2011Read time:

India is a huge country and the world largest democracy with a population of over 1.2 billion. Since its independence in 1947, India has progressed in almost every field be it manufacturing, industrialization, space, science & technology, nuclear energy, retail industry etc. Such a vast and dynamic economy provides tremendous employment opportunities to the people of India. But there exists another side of the coin, which comprises of workers who have not acquired a high profile, tasted the benefits that can be gained from organization, or derived the advantages flowing from high visibility. This section of the economy is known as the unorganized sector.


Unorganized Sector

In the unorganized sector, workers are engaged in a variety of occupations or employments, ranging from those like forest workers, tribal’s trying to follow traditional vocations within their traditional habitats, and fishermen who venture out to sea in vulnerable canoes, to those who are working in their homes with software, or assembling parts for a highly sophisticated product. Thus, managing and handling this unorganized sector is a major challenge and a tremendous responsibility on the shoulders of the Government. NREGA is another scheme implemented by the government for providing rural employment.

According to the National Commission for Enterprises in the Unorganized Sector (NCEUS), 369 million workers are there in the unorganized sector in India. The issues that affect them and need to be focused upon are the regulation of their working conditions, provisioning of resources in the form of budgetary allocations to implementing measures to improve their condition i.e.; overcome liabilities of major illnesses, loss of employment and also administrative accountability regarding social security and welfare measures.

As per the “Regulations of Employment and Conditions of Service Act, 1996” and “Building and Other Construction Workers Welfare Cess Act, 1996”, all states and Union territories are to levy a cess of 1% of the construction cost & use it for education, health and safety of workers & their families. They are applicable to establishments employing 10 or more workers & projects costing more than 10 lakhs. These benefits are available only to registered workers but absence of proper registration means that the benefits cannot reach all workers. Majority of the 17 million employed in construction industry on a daily basis, (as per the 1990-2000 survey by National Sample Survey Organization), which contributes 60% to the “national economic output” of the country are illiterate immigrants, unaware of their rights and benefits & also vulnerable to exploitation.

With fewer employment openings in the organized and agricultural sectors, the rural and tribal laborers depend not only on the construction industry in large cities and towns but also child labor to add to the family income. Poor health, seasonal nature of the job and women workers getting paid less than their male counterparts add to their woes and suffering.

The Central and State Governments, alongwith public/private initiative, run several schemes and funds to benefit the workers.eg,

healthcare through hospital services and also mobile dispensaries,

reimbursement of expenses incurred on major illnesses, surgeries,

maternity benefits,

Group insurance schemes etc.

Such measures will not only improve their working and living conditions but also make them lead a life of self-esteem, security and dignity. With a conscious effort, the unorganized sector can be gradually transformed into the backbone of the Indian economy by preparing a healthy workforce for a better tomorrow and self-reliant India.

About the Author : Sunita Saharia is a legal expert and the co-founder of the NGO (International Society for Human Awakening and Development).


The articles are for educational & academic purpose only, and have been uploaded by the MBA Skool Team.

If you are interested in writing articles for us, Submit Here

Share this Page on:
Facebook ShareTweetShare on Linkedin