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Shift in Employment Trends

Why is it in the news?

  • A Recent report released by Bahutva Karnataka highlights significant changes in the employment landscape in India.
  • The document underscores the rising prevalence of self-employment and the persistently low representation of formal employment.

The key findings of the report

  • Minimum Wage: The report draws attention to the fact that numerous households continue to earn wages lower than the proposed National Floor Level Minimum Wage (NFLMW) despite recommendations for it to be at least 375 per day and 3,050 per week in 2019.
  • Widening Wage Inequality: The widening gap between the rich and the poor is underscored as the report presents data from the World Inequality Database 2022, indicating that the top 1% and 10% of the population hold a substantial portion of the national income, while the bottom 50% holds a relatively small share. Additionally, the report notes negligible increases in wage earnings when adjusted for inflation.
  • Low Formal Employment: The report emphasizes that the proportion of employment in the formal sector remains below 25%, with a stagnant share of formal employment that offers social security and other benefits.
  • Increase in Self-Employment: A notable shift is observed in the rising number of self-employed individuals, particularly women, with the share of self-employed women witnessing significant growth over the years.
  • Unpaid Labor: The report indicates a concerning increase in the proportion of women engaged in unpaid labor within family enterprises or farming, reflecting a lack of alternative job opportunities and stagnating household income.
  • Gender Disparities Persist: Despite increased engagement in self-employment, gender disparities persist as women are frequently involved in unpaid labor or informal work due to limited opportunities in the formal sector.
  • Implications of Economic Stagnation: Economic stagnation has led to restricted growth in formal sector employment, further propelling individuals, especially women, towards self-employment and unpaid labor as alternative sources of income.

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