The workers who are working in informal sector is known as.
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While the government takes great pride in the fact that India is one of the fastest growing major economies in the world and economic prognoses tout a radiant future, the nation is in fact in a rather precarious position. In spite of robust economic growth which averaged at over 7% per annum for over a decade, income inequality continues to expand, and the rate at which national poverty is diminishing is not proportionate to the growth in gross domestic product. These discrepancies arise out of the fact that the
poorest sections of the population are not benefiting from the country’s GDP growth by virtue of being excluded from the organised production process. Indian poverty persists not only due to insufficient economic activity but also due to the presence of large unorganised sector.
In 2018, only 50% of the Indian population participated in the labour force, 81% of which was employed in the informal sector, also known as the unorganised sector or the shadow economy. While the size of the unorganised sector has been shrinking gradually (it stood at 86% of the population in 2005), the portion of informal sector workers within the organised sector (as contract/casual labourers) has been on the rise. Taking this into account, the proportion of informal workers in the total participating labour-force reaches around 92%.
Although the informal sector is accredited with the absorption of large masses of workers that would otherwise remain unemployed due to the absence of formal-sector opportunities, the reprieve provided by it is detrimental to the country’s developmental progress. The informal segment of the economy is responsible for maintaining India’s unequal status quo; in fact it is accountable for exacerbating the pervasive divide in the standards of living amongst the population. Figures published by Credit Suisse in 2018 state that the richest 10% Indians own around 80% of the country’s wealth while the less-privileged 60% own less than 5%. Inequality obstructs the eradication of poverty, leads to social stratification and drives crime upward.