Context:

Indian cities are becoming hubs for unstable employment opportunities.

Background

The International Labour Organization (ILO) estimates that about 92% of India's workforce is employed in the informal sector; they work without formal contracts and have little or no job security.

Indian cities are experiencing large-scale migration, with new workers arriving in large numbers. Job opportunities motivate this migration, but a lack of affordable housing options makes it difficult for many migrants to afford to establish in cities.

Pradhan Mantri Awas Yojana (PMAY) aims to provide affordable housing, however, its implementation are insufficient for informal workers. Even slums, which were previously low-cost housing options, are becoming expensive for migrant workers. As a result, workers who move to cities for work are facing challenges in getting affordable housing.

Must Read: Pradhan Mantri Awas Yojana (PMAY)

Urbanization in India

After gaining independence, India adopted a mixed economy model that prioritized both private and public sector growth. This shift accelerated industrial development, particularly in cities, which created more jobs and economic opportunities, attracting people from rural areas.

According to the 2011 Census, urban population increased from 27.7% in 2001 to 31.1% in 2011. The United Nations predicts that by 2030, 40.76% of India's population will live in cities. Such consistent growth highlights a trend of rapid urbanization, encouraged by economic changes and industrialization.

India's rapid urbanization presents challenges because it puts enormous pressure on urban infrastructure, leading to issues such as extreme inequality, poor service delivery, and inadequate city facilities. As urban populations grow, cities struggle to provide basic services, raising barriers to maximizing economic productivity.

Schemes for Urban Planning

The Smart Cities Mission was launched in 2015 with the goal of developing 100 smart cities in the country that will have advanced infrastructure and provide a high quality of life for their residents.
The Atal Mission for Rejuvenation and Urban Transformation (AMRUT) was established in 2015 to improve basic urban infrastructure in cities and towns, including water supply, sewerage, and transportation.
Pradhan Mantri Awas Yojana (PMAY) was launched in 2015 to provide affordable housing to the urban poor. It consists of two components: PMAY-Urban for urban areas and PMAY-Gramin for rural areas.

Issues related to Urbanization and employment in India

Historically, Urbanisation in India has been closely linked to national development and industrialization. However, since the mid-1980s, industrial growth has slowed, resulting in a service-based economy and an informal employment sector.

Urban planning has shifted away from providing social housing and toward market-driven solutions, with real estate development and land pooling now driving urban growth.

As production in India became more fragmented after 1990, the organized strength of the urban working class, which had previously been concentrated in industries such as textile mills, started to decline. The loss of direct production jobs opportunities has weakened workers' collective bargaining power, and limited influence over employers and the state.

Rise of Gig economy

With the rise of digital platforms in India, service jobs such as food delivery and ride-sharing have expanded. These platform jobs often offer temporary employment without benefits or job security. Workers are tightly controlled by the platforms, they lack basic protections, and have little bargaining power.

The Periodic Labour Force Survey (2017-18) reports that 92% of the 61 million jobs created since 1991 have been informal. This shift reflects the insecure nature of employment, with a growing dependence on gig work, which increases worker vulnerability and complicates unionization efforts.

Workers in sectors such as food delivery earn low wages and have few options for improving their social circumstances, which increases socioeconomic inequality.

What is the Gig Economy

A gig economy is largely based on part-time and temporary jobs filled by independent contractors and freelancers rather than full-time permanent employees.

Gig workers have flexibility and independence, but little to no job security. Employers in a gig economy save money by not providing benefits like health insurance and paid time off.

No Social Security

Informal work supports about 92% of Indian households. These jobs provide no social security benefits, such as pensions or health insurance, making families vulnerable to economic shocks. Every year, 12 million households, or nearly 60 million people are forced to live in poverty due to a lack of health insurance.

Change in Production model

India's production model has become more capital-intensive and labor-saving. Between 2000 and 2012, Gross Value Added (GVA) increased by 6.2%, but employment increased by only 1.6%.

GVA increased by 6.7% between 2012 and 2019, while employment increased by only 0.001%, indicating that job creation was limited despite economic growth.

Capital-intensive models benefit organizations that control capital and technology, it marginalizes low-skilled workers.

Schemes for unorganized sector workers

Pradhan Mantri Shram Yogi Maan-dhan Yojana (PM-SYM) offers social security to unorganized workers such as street vendors, agricultural workers, and construction site labourers aged 18 to 40 who do not pay income tax.
Aam Aadmi Bima Yojana helps families living below or just above the poverty line by providing insurance coverage to members aged 18 to 59 who work in certain vocational jobs, such as fishermen, rickshaw pullers, and beedi workers.
Atal Beemit Vyakti Kalyan Yojana provides temporary financial assistance to insured employees who lose their jobs, offering 90 days of financial relief for those who meet eligibility criteria.
The Atal Pension Yojana provides pension benefits to private-sector employees and unorganized sector workers aged 18 to 40 with a linked bank account and Aadhaar.

Way Forward

India can improve urban governance by decentralizing management, providing more autonomy to cities in its strategic planning, financing, and project execution. It could assist cities in managing economic growth, infrastructure resilience, and job creation.

Informal workers require a comprehensive social protection system to ensure their livelihoods and good living conditions. Labor hostels and low-cost rental housing are essential measures, labor unions and urban planners must advocate for these provisions to ensure decent living conditions for workers in India's rapidly expanding cities.

India's urban development requires efficient governance structures and well-coordinated projects that turn resources into real improvements in cities. Improving urban areas and creating adequate job opportunities to improve the standard of living of urban population aligns with India's larger social and economic goals.

Must Read Articles:

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INDIA EMPLOYMENT REPORT 2024

Source:

The Hindu

Oxford Policy Management

Wikipedia