According to the definition of International Labour Organisation (ILO, 2002), they comprise
In India the self-employed workers account for 93% of the total workforce. In other developing countries/regions also, informal employment comprises 50%-75% of non-agricultural employment, e.g., 78% in Sub-Saharan Africa, 51% in Latin America, 55% in Mexico. Even in developed economies, the temporary/part-time/self-employed – i.e., employment without benefits or protection – account for a large working population.
The contribution of the unorganized workforce to the economic health of India society has largely remained neglected. In India, this sector accounts for
- 60% of Net Domestic Product (i.e., GDP minus depreciation),
- 68% of income, 60% of savings,
- 31% of agricultural exports, and
- 41% of manufactured exports.
Even in the urban centers of India, the unorganized workers account for about 60-67% of the employment.
Women workers in the unorganized sector – the farm workers, vendors, casual construction labour, domestic help, home-based workers – are even far more neglected and unaccounted-for part of the informal economy. This is so, since the self-employed women work from homes and their contribution is mostly not calculated into the national economic data. However, according to the National Sample Survey ’05, one-third of the informal sector workforce (about 120mn) comprises of women. Collectively, they accounted for 96% of the female workforce in the country, and contribute to about 20% GDP of India.