By IANS,
New Delhi : A whopping 93 percent of India’s working population is employed in the informal sector that leaves them with no social security and makes them susceptible to wide poverty traps, says a report by the International Labour Organisation (ILO).
This is also the largest percentage of working population for any country in private, unregistered enterprises, said the UN agency Monday, based on 2004 data for India. The report was in collaboration with the World Trade Organisation (WTO).
“Trade contributed to growth and development worldwide. But this has not automatically translated in an improvement in the quality of employment,” said WTO Director-General Pascal Lamy, commenting on the findings of the report.
“Trade opening needs proper domestic policies to create good jobs. This is all the more evident with the current crisis that has reduced trade and thrown thousands of people into informal jobs,” added Lamy.
Informal employment involves private, unregistered enterprises which are not subject to national law or regulation, offer no social protection and involve self-employed individuals, or members of the same household.
The report also seeks to draw attention to the dangers of not having access to a social security net, which is mostly the case for people with informal jobs.
“Informality, trade and growth are intimately linked. The informal economy is a symptom of a country’s low resilience to shocks and the vulnerability of its labour market,” said the report.
“Insurance against shocks is, therefore, less well developed, leaving households with little to fall back on in times of crisis,” said the report, while pointing out that informality in most countries is associated with low levels of education.
The levels of informality, the report said, vary substantially across countries, ranging from as low as 30 percent in some Latin American countries to more than 80 percent in certain sub-Saharan African and South Asian countries.