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3) Informalisation of employment in India is policy induced and a corollary of neoliberalism. Comment.(250 words)

Topic– Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.

Effects of liberalization on the economy.

3) Informalisation of employment in India is policy induced and a corollary of neoliberalism. Comment.(250 words)

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Why this question

Employment is a critical issue for any country, especially for India which is home to the world’s largest demographic dividend. Thus it is important to discuss how informalization of employment is a result of neoliberalism and policy environment.

Directive word

Comment- here we have to express our knowledge and understanding of the issue and form an overall opinion thereupon.

Key demand of the question.

The question wants us to express our opinion on the statement- Informalisation of employment in India is policy induced and a corollary of neoliberalism. Whether we agree or not we have to present our facts/ arguments and then sum up the discussion with an overall opinion.

Structure of the answer

Introduction– write a few lines impressing upon the informalization of employment in India. E.g While the low level of education and skill is used to explain away the unorganised sector informalisation, informalisation in the organised sector, with presumably higher level of education and skill, is widespread and perplexing.

Body

  • discuss how this is a result of policy environment in India. E.g Driven by the traditional perception that the government is the most secure employer in the country, the pressure of aspiration that the public sector handles has been perpetually high; the cost of entering the government job market is prohibitive. Jobseekers, unable to crack though such a system, are more likely to fall back on informal arrangements;pay hikes through successive pay commissions, have made recruitment an expensive affair for the government itself, particularly for the state governments, who find it difficult to match up to the central government pay-packages with their limited resources. Permanent posts lie vacan and are replaced with increasing number of contractual or casual recruitment etc.
  • Discuss how neoliberalism is responsible for informalization of employment in India. E.g From the perspective of businesses, informal employment (casualisation per se) can keep costs down, a factor that is perhaps more important than incremental productivity, in staying competitive. At the same time, it gels well with the principle of fiscal austerity of the neo-liberals etc.

Conclusion– sum up your discussion in a few lines and form a fair and a balanced conclusion on the above issue.