Introduction
Differences between Organised and Unorganised Sectors
| Basis | Organised Sector | Unorganised Sector |
|---|---|---|
| Definition | Enterprises registered with the government and following rules and regulations. | Enterprises not registered or outside the control of government regulations. |
| Job Security | Workers have stable and secure jobs with written contracts. | Jobs are insecure with no formal contracts. |
| Wages | Regular, fixed wages with timely payments. | Often paid low and irregular wages. |
| Working Hours | Regulated working hours with paid overtime. | Long and undefined working hours with no overtime benefits. |
| Benefits | Provident fund, medical benefits, paid leave, and insurance are provided. | No access to health insurance, paid leave, or retirement benefits. |
| Regulations | Subject to labour laws, minimum wage laws, and social security acts. | Operates with little or no government regulation. |
| Examples | Banks, government offices, large companies, schools. | Street vendors, small shop owners, daily wage laborers, domestic workers. |
| Work Environment | Relatively safer, professional, and monitored. | Often unsafe and lacking basic amenities. |
Problems Faced by People in the Unorganised Sector
Despite employing over 90% of India's workforce, the unorganised sector remains neglected in terms of policy support and worker welfare. The workers in this sector face numerous challenges:
1. Lack of Job Security
Most unorganised sector workers are employed on a temporary or casual basis. There are no written contracts, and employers can terminate workers at any time without notice. This makes their livelihoods highly uncertain.
2. Low and Irregular Income
Workers in the unorganised sector often receive wages below the minimum wage set by the government. Their income is not only low but also irregular, making it difficult to plan for the future or meet daily needs. Seasonal jobs, especially in agriculture and construction, further add to income instability.
3. No Social Security Benefits
Unlike the organised sector, workers in the unorganised sector do not receive benefits like pension, provident fund, health insurance, or maternity leave. This makes them vulnerable during illness, old age, or emergencies.
4. Poor Working Conditions
Many unorganised sector workers operate in unsafe environments without proper sanitation, safety equipment, or ventilation. For example, construction workers often work without helmets or harnesses, risking injuries.
5. Exploitation by Employers
Due to the absence of regulation and lack of awareness among workers, employers often exploit them by making them work long hours without overtime pay or denying them their rightful wages. Child labour and bonded labour are also more prevalent in this sector.
6. No Legal Protection
Unorganised workers often do not have access to legal help or redressal mechanisms. Their issues are not taken seriously, and there is little accountability on the part of employers. Legal enforcement of labour rights is almost non-existent in this sector.
7. Lack of Skill Development
Workers in this sector are usually unskilled or semi-skilled and have limited opportunities for training or education. This prevents them from improving their income potential or transitioning to better jobs in the organised sector.
8. Gender Inequality
Women in the unorganised sector face double discrimination. Not only are they paid less than men for the same work, but they are also often subjected to harassment and denied maternity benefits.
9. Impact of Economic Fluctuations
Workers in the unorganised sector are the first to be affected during economic downturns, natural disasters, or pandemics. For instance, during the COVID-19 lockdowns, millions of informal workers lost their livelihoods overnight without any social safety net.
Conclusion
The unorganised sector, despite being the backbone of India's economy, remains largely neglected in terms of worker welfare and protection. The stark differences between the organised and unorganised sectors highlight the urgent need for inclusive labour reforms. Ensuring fair wages, job security, and access to social security for unorganised workers is not just a matter of economic policy but also a question of social justice. The government must take concrete steps to formalise the informal sector and extend the benefits of development to all sections of the workforce.
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