Informal And Unorganised Sector

Question by: Feroze Varun Gandhi

1. whether the Government maintains a distinction between ‘informal ‘and ‘unorganised‘ sector;
2. if so, the details thereof and if not, the reasons therefor;
3. the total number of unorganised and informal workforce and its proportion to the total workforce and the percentage of working females employed in the unorganised or informal sector; and
4. the steps taken by Government to promote formalisation of workforce?

Answer by: Minister of State (IC) for Labour and Employment (Shri Santosh Kumar Gangwar)

• The Unorganised Workers’ Social Security Act, 2008 does not make any distinction between ‘informal’ and ‘unorganised’ sector. As per the definition given in the Act, “unorganised sector” means an enterprise owned by individuals or self-employed workers and engaged in the production or sale of goods or providing service of any kind whatsoever, and where the enterprise employs workers, the number of such workers is less than ten.
• As per the Economic Survey 2019-20, estimated total employment in the country on the basis of Periodic Labour Force Survey (PLFS), 2017-18 is 47.13 crore, out of which 9.05 crore is in the organised sector and 38.07 crore is in the unorganised sector. As per PLFS 2018-19, the female worker participation ratio for age-group (15 years and above) as per usual status is 23.3 per cent. This includes both organised and unorganised sector.
• Pradhan Mantri Rojgar Protsahan Yojana (PMRPY) was launched by the Ministry of Labour & Employment in 2016 with the objective to incentivise employers for creation of formal employment with social security benefits. Under the scheme, Government of India is paying Employer’s full contribution i.e. 12% towards EPF and EPS both (as admissible from time to time) for a period of three years to the new employees through EPFO w.e.f. 01.04.2018. The terminal date for registration of beneficiary through establishment was 31st March, 2019. The beneficiaries registered up to 31st March, 2019 will continue to receive the benefit for three years from the date of registration under the scheme. As on 14th September, 2020, around 1.21 crore beneficiaries have been benefitted through 1.52 lakh establishments.