1st PUC Economics Question Bank Chapter 7 Employment-Growth, Informalisation and Other Issues

Karnataka 1st PUC Economics Question Bank Chapter 7 Employment-Growth, Informalisation and Other Issues

1st PUC Economics Employment-Growth, Informalisation and Other Issues Textbook Questions and Answers

I. Choose the correct answer(each question carries 1 mark)

Question 1.
Those activities which contribute to the gross national product are called
(a) Social activities
(b) Cultural activities
(c) Political activities
(d) Economic activities.
Answer:
(d) Economic activities

Question 2.
GDP stands for
(a) Gross domestic product
(b) Gross domestic price
(c) Gross dollar price
(d) None of the above
Answer:
(a) Gross domestic product

Question 3.
Which of the following activities is not considered productive work?
(a) Household activities
(b) Agricultural activities
(c) Service sector
(d) Industrial activities
Answer:
(a) Household activities

Question 4.
Workers who own and operate an enterprise to earn their livelihood are called
(a) Ministers
(b) Public servant
(c) Self-employees
(d) Government doctor
Answer:
(c) Self-employees

Question 5.
Urban people are mainly engaged in the
(a) Primary sector
(b) Service sector
(c) Mining
(d) Agriculture
Answer:
(b) Service sector

Question 6.
India is an
(a) Industrial country
(b) Scientifically developed country
(c) Agrarian nation
(d) Service developed country
Answer:
(c) Agrarian nation

Question 7.
Those who are working in the formal sector enjoy
(a) Economic benefits
(b) Social security benefits
(e) Educational advantages
(d) Cultural benefits
Answer:
(b) Social security benefits

Question 8.
Owing to the effort of the following organization Indian government initiated modernization and also a provision of social security measures to informal sector workers.
(a) GNP
(b) NSSO
(c) ILO
(d) LPG
Answer:
(c) ILO

II. Fill in the blanks (each question carries 1 mark)

Question 1.
…………………..insisted upon education and training through a variety of works including
Answer:
Mahatma Gandhi

Question 2.
The nature of employment in India is……………….
Answer:
Multifaceted

Question 3.
The majority of workforce reside in………………areas in our country
Answer:
Rural

Question 4.
For every 100 rural females about………………..participate in the employment market.
Answer:
25 persons

Question 5.
The Construction workers are known as
Answer:
Casual wage labourers

Question 6.
When a worker is engaged by someone and paid his/her wages on a regular basis he/she is known as
Answer:
Regular salaried employee.

Question 7.
………………is the main source of employment for the majority of workers in India.
Answer:
Primary sector

Question 8.
The government protects the rights of workers through……………..
Answer:
Labour laws

Question 9.
In India, disguised unemployment can be seen more in the………… sector
Answer:
Agricultural.

III. Answer the following questions in a word/sentence (each question carries 1 mark)

Question 1.
Why do people work?
Answer:
People work to get some earning for a living.

Question 2.
Give the meaning of workforce.
Answer:
All those who are engaged in economic activities are workers or one part of the workforce.

Question 3.
Define worker population ratio.
Answer:
The worker-population ratio can be obtained by dividing the total number of workers of India by the population and multiplied by 100.

Question 4.
What is in formalization of the workforce?
Answer:
In-formalisation of the workforce is the process where fund companies or employers are trying to employ workers without assuring them job security, provident, gratuity, ESI, periodical pay hike etc. Some well, established firms are converting their structure of employment from formal to informal to avoid the risk of labour laws. This is known as the in-formalisation of the workforce.

Question 5.
Define jobless growth. (S-2018)
Answer:
During the late 1990s, employment growth started declining and reached the level of growth that India had in the early stages of planning. During these years, we also find a widening gap between the growth of GDP and employment. This means that in the Indian economy, without generating employment, we have been able to produce more goods and services. This is known as jobless growth.

Question 6.
What is meant by casualisation of the workforce?
Answer:
The process of moving from self-employment and regular salaried employment to casual wage work is called as casualisation of the workforce.

Question 7.
Give the meaning of Open unemployment.
Answer:
According to economics, Open unemployment is a situation where people are ñot able to get employment of even hour in Haifa day.

Question 8.
What Is Seasonal unemployment? (N-20Th)
Answer:
Seasonal unemployment is a situation where people get employment only during a particular season. For example, agricultural labourers get jobs only during the rainy season.

Question 9.
Expand ILO.
Answer:
International Labour Organisation.

Question 10.
What do you mean by Formal Sector Establishment?
Answer:
It refers to that sector where all the Public Sector Establishments and those private sector establishments employ 10 or more hired workers.

Question 11.
What do you mean by Informal Sector Establishment?
Answer:
It is that sector where less than 10 workers are employed without job security, provident fund, ESI, etc. For example, agricultural labourers.

Question 12.
Expand GDP.
Answer:
Gross Domestic Product.

Question 13.
Expand GNP.
Answer:
Gross National Product.

IV. Answer the following questions in four sentences (each question carries 2 marks)

Question 1.
Who are all included in the labour force?
Answer:
All those who are engaged in economic activities, in whatever capacity-high or low are called workers. Even if some of them temporarily abstain from work due to illness, injury or other physical disability, bad weather, festivals, social or religious functions are also workers. Apart from these, the labour force also consists of those who help the main workers and the self-employed workers.

Question 2.
What is the difference between the labour force and the workforce?
Answer:

Labour Force	WorkForce
1. It includes all the workers who are engaged ¡n economic activities	1. It includes all those workers who are engaged in both economic and non-economic activities
2. It does not include the work by women at home as cooks. fetching water, fuel, wood etc. as they are not paid for that.	2. It includes women carrying out works like cooking. fetching water, participating in farm labour. etc., though it is not paid for.

Question 3.
Why are regular salaried employees more in urban areas than in rural areas?
Answer:
In regular salaried employment, men are found to be so engaged ¡n greater proportion. They form 20% whereas women form only 13 %. The main reason is skill requirement. Since regular salaried jobs require skills and a higher level of literacy. more employees can be seen from urban areas than rural areas.

Question 4.
Name the four kinds of unemployment.
Answer:
The kinds of unemployment are as follows:

• Open unemployment
• Disguised unemployment
• Seasonal unemployment
• Underemployment
• Technical unemployment
• Frictional unemployment.

Question 5.
What are net earnings? How do you get GNP?
Answer:
If the total value of exports is greater than the total value of imports. it is called net earnings.
When we add the net earnings from foreign transactions to the value of total goods and services produced. we get Gross National Product (GNP). All those activities which contribute to the GNP are called economic activities.

Question 6.
Who is not included in the labour force?
Answer:
The women who carry out household works like cooking. fetching water and fuelwood and participating in farm labour are generally not included in the labour force. This is mainly because they are not paid wages in cash or in the form of grains mostly there is no payment for them.

Question 7.
Who are self-employed? Give two examples. (N-2018)
Answer:
The self-employed are those workers who own and operate an enterprise themselves to earn their livelihood.

The best examples for self-employed are as follows:

• People running petty shops
• People having their own transport enterprises.
• Farmers working in their own farmland
• Engineers running their own construction companies.
• Teachers running their own tutorial or coaching centres.
• People having their own autos and cabs.

Question 8.
Name the types of rural unemployment.
Answer:
The main types of rural unemployment are as follows:

• Disguised unemployment
• Seasonal unemployment
• Open unemployment
• Technological unemployment.

Question 9.
Why does the rural workforce migrate to urban areas during some part of the year?
Answer:
Many people migrate to an urban area, pick up a job and stay there for some time, but come back to their home villages as soon as the rainy season begins. This is mainly because work in agriculture is seasonal there are no employment opportunities in the village for all the months of the year.

So, when there is no work to do on farms, people go to urban areas and look for jobs.

Question 10.
Name the three sectors of the economy.
Answer:
The three sectors of the economy are as follows:

• Primary sector: It includes agriculture, mining, fishing, forestry, etc.
• Secondary sector: It includes all manufacturing industries.
• Service sector: It includes, transport, communication, banking, insurance, health, education, warehousing, etc.

Question 11.
Distinguish between formal and informal sector labour.
Answer:

Formal Sector Labour	Informal Sector Labour
1. It includes all the Public sector establishments and those Private Sector Establishments which employ 10 or more hired workers	1. The informal sector is that sector where we see less than 10 workers employed in different establishments.
2. The examples for formal sector workers are workers in Public Sector Industries like HMT, HAL, BHEL, KSRTC, BMTC, etc.	2. The examples for the informal sector are agricultural labourers, owners of small enterprises, non-farm casual wage labourers
3. They get social security measures like pension, gratuity, bonus, maternity benefits etc.,	3. They do not get social security measures like pension, bonus, maternity benefits etc.,
4. Employment is regular and permanent	4. Employment is seasonal and temporary

Question 12.
What is unemployment according to NSSO? (S-2018)
Answer:
According to National Sample Survey Organisation (NSSO), ‘Unemployment is a situation in which all those who, owing to lack of work, are not working but either seek work through employment exchanges, intermediaries, friends or relatives or by making applications to prospective employers or express their willingness or availability for work under the prevailing condition of work and remunerations.

Question 13.
Name the three sources of data regarding unemployment in India.
Answer:
There are three sources of data on unemployment, they are as follows:

1. Reports of Census of India.
2. Reports of National Sample Survey Organization on Employment and Unemployment situation and
3. Directorate General of Employment and Training Data of Registration with Employment Exchanges.

V. Answer the following questions in twelve sentences (each question carries 4 marks)

Question 1.
Write the importance of employment.
Answer:
Work or employment plays an important role in our lives as individuals and as members of society. People work for earning and living only some people get or have money by inheriting it, not working for it. This does not completely satisfy everybody.

It is well understood that being employed in work gives us a sense of self-worth and enables us to relate ourselves meaningfully with others. Every working person is actively contributing to national income and hence, the development of the country, by engaging in various economic activities that are the real meaning of earning a living.

We do not work only for ourselves; we also have a sense of accomplishment when we work to meet the requirements of those who are dependent on us. Having recognised the importance of work, Mahatma Gandhi rightly said that education and training should be given importance for self-reliance.

Studying about working people gives us insights into the quality and nature of employment in our country and helps in understanding and planning our human resources. It helps us to analyse the contribution made by different industries and sectors towards national income. It also helps us to address many social issues like exploitation of marginalised sectors of society, child labour, etc.

Question 2.
Analyse the recent trend in sectoral distribution union of the workforce in India.
Answer:
The sectoral distribution of the workforce in India can be explained with the help of the following table:

The primary sector is the main source of employment for the majority of workers in India. The secondary sector provides employment to only about 24% of the workforce. About 27% of workers are in the service sector. The above table shows that about 64 % of the workforce in rural India depends on agriculture, forestry and fishing. About 20 % of rural workers are working in manufacturing industries, construction and other industrial activities. The service sector provides employment to only about 16% of rural workers.

Agriculture is not a major source of employment in urban areas where people are mainly engaged in the service sector. About 60% of urban workers are in the service sector. The secondary sector gives employment in about 35% of the urban workforce.

Question 3.
Discuss the two types of rural unemployment.
Answer:
The following are the two types of rural employment.
(a) Disguised unemployment: It is that type of unemployment where we can come across an excess number of workers engaged in some work, but actually less number of workers are required. For instance, suppose a farmer has four acres of land and he actually needs only two workers and a half to carry out various operations on his farm in a year, but if he employs five workers and his family members such as his wife and children, this situation is called disguised unemployment.

(b) Seasonal unemployment: It is that unemployment where the rural people get employment. only during a particular season. We have noticed that many people migrate to urban areas, pick up a job and stay there for some time, but come back to their home villages as soon as the rainy season begins. This is because work in agriculture is seasonal; there are no many employment opportunities in the village for all the months of a year. When there is no work to do on farms, people go to urban areas and look for temporary jobs. This is one of the instances of seasonal unemployment.

Question 4.
How does the government generate employment?
Answer:
The government is making efforts to generate employment opportunities for unemployed persons through two categories i.e.,

1. direct and
2. indirect.

In the first category, the government is directly providing job opportunities by employing people in various departments for administrative purposes, industries, hotels and transport corporations. In the second category, the government had introduced a New Economic Policy in 1991 in the form of LPG i.e., Liberalization, Privatization and Globalisation which has provided ample opportunities to private entrepreneurs to start their own production centres which are creating employment opportunities for millions of people in India.

Further, when the output of goods and services from government enterprises increase, then private enterprises which receive raw materials from government enterprises will also raise their output and hence increase the number of employment opportunities in the economy. For instance, when a government-owned steel company increases its output, it will result in a direct increase in employment in that government company, simultaneously, private companies, which purchase steel from it, will also increase their output and thus employment. This is the indirect generation of employment opportunities by the government initiatives in the economy.

Question 5.
Write a note on the informal sector.
Answer:
The informal sector is that sector where we see less than 10 workers employed in different establishments. The informal sector includes millions of farmers, agricultural labourers, owners of small enterprises and people working in those enterprises as also the self-employed who do not have any hired workers. It also includes all non-farm casual wage labourers who work for more than one employer such as construction workers and headload workers.

About 6% of the total workforce is under the formal sector and 94% are in the informal sector. Male workers account for 69% of the workforce in the informal sector.

The following are major issues with the informal workforce:

• It does not ensure job security
• Poor working conditions
• Does not ensure social security measures like pension, bonus, maternity benefits
• Employment is seasonal and temporary
• Low wages.

Question 6.
Name the different types of economic activities.
Answer:
Generally, we can divide all economic activities into eight different categories. They are as follows:

• Agriculture
• Mining and quarrying
• Manufacturing industries
• Electricity, gas and water supply
• Construction industry
• Trade-both internal and external
• Transport and storage
• Services.

For simplicity, all the working persons engaged in these divisions can be clubbed into three major sectors viz.,
(a) Primary sector
(b) Secondary sector
(c) Service sector.

Question 7.
What are the problems being faced by the workers of the informal sector?
Answer:
The following are the major problems faced by workers in the informal section:

• It does not ensure job security
• Workers and enterprises do not get regular income
• The workers do not have any protection of regulation from the Government
• Workers are dismissed without any compensation
• The technology used is outdated
• The companies do not maintain proper accounts
• Workers in this sector live in slums and are squatters
• Poor working conditions.
• It does ensure social security measures like pension, bonus, maternity benefits.
• Employment is seasonal and temporary.

VI. Answer the following questions in twenty sentences (Each question carries 6 marks)

Question 1.
What are the types of unemployment in Indian? Discuss any two.
Answer:
The kinds of unemployment are as follows:

• Open unemployment
• Disguised unemployment
• Seasonal unemployment
• Underemployment.
• Technical employment
• Frictional employment

Disguised unemployment: It is the unemployment, where we can come across an excess number of workers engaged in some work but actually less number of workers required. For instance, suppose a farmer has four acres of land and he actually needs only two workers and a half to carry out various operations on his farm in a year, but if he employs five workers and his family members such as his wife and children, this situation is called disguised unemployment.

Seasonal unemployment: It is the type of unemployment, where the rural people get employment only during a particular season. We have noticed that many people migrate to urban areas, pick up a job and stay there for some time, but come back to their home villages as soon as the rainy season begins. This is because work in agriculture is seasonal; there are not many employment opportunities in a village for all the months of a year. When there is no work to do on farms, people go to urban areas and look for temporary jobs. This is one of the instances of seasonal unemployment.

Question 2.
What are the main causes of unemployment in India?
Answer:
The main causes for unemployment in India are as follows:
(a) Population explosion: Rapid population growth is the leading factor responsible for unemployment in India. This has adversely affected the unemployment situation in two ways. Firstly, the growth of the population has directly encouraged unemployment by making a large addition to the existing labour force. Secondly, the rate of job expansion could never be as high as the population growth would have required.

(b) Season agricultural and backwardness of agricultural: In a rural economy, agriculture is the main source of employment. However, most of the rural people are engaged directly and indirectly in agricultural operations. But, agriculture in India is basically a seasonal occupation. It provides employment only for certain months i.e., only during rainy days. During the rest of the period in a year, people would become unemployed.

(c) Illiteracy and ignorance: Many people are illiterates and unskilled. They are not trained in accordance with the employment being generated. There is a mismatch between the education industry and the employment industry.

(d) Slow growth: The growth of the Indian economy is not at the expected level. The growth of GDP is still less than 7%. That means income that is being contributed to the national income generated through the creation of employment opportunities is insufficient.

(e) Lack of initiatives from the government: In India, the government is inactive in the creation of jobs. Rather, the government is indulging in disinvestment and closing Public Sector Industries due to industrial sickness. This is aggravating the problem of unemployment.

(f) Low investment: There is a decline in the rate of investment due to a lack of supportive atmosphere both in the private and public sectors. This has slowed down the creation of new employment opportunities in India.

(g) Orthodox nature of population: In India, the majority of people are traditional and very orthodox and believe in blind beliefs. Many will be sticking on to some age-old occupation even many though it has lost scope in the modem world. This has made them voluntarily unemployed.

Question 3.
What do you mean by organized sector? Discuss the reasons for fall in employment in the organized sector. (S-2018)(Board Paper)
Answer:
The organized sector is .that sector which includes all the Public Sector Establishments and those Private Sector Establishments which employ 10 or more hired workers. They are called formal sector or organized sector establishments and those who work in such establishments are formal sector workers or organized labour.

The following are the major reasons for the decline in employment opportunities in the organized sector:

• Lack of initiative from the government in creating new employment opportunities
• Industrial sickness has made Public Sector Industries cut down on their vacancies
• The migratory character of the workforce
• The strict labour laws have made Public Sector Enterprises go for in-formalisation of labour which has resulted in a decline in employment opportunities
• Privatisation and Disinvestment have made a decrease in jobs in the public sector.
• Amalgamation and merger among large scale industries have led to a decrease in employment opportunities business process outsourcing is also one of the reasons for the decline in employment opportunities
• The risk of loss and economic recession is forcing the public sector companies to reduce the working staff.

Question 4.
What role does the government play in generating employment opportunities in India? (N-2018)
Answer:
The government is making efforts to generate employment opportunities for unemployed persons through two categories i.e., direct and indirect.

In the first category, the government is directly providing job opportunities by employing people in various departments for administrative purposes, industries, hotels, transport corporations etc.

In the second category, the Government had introduced a New Economic Policy in 1991 in the form of LPG i.e., Liberalization, Privatisation and Globalisation which has provided a sample; opportunities for private entrepreneurs to start their own production centre which is creating employment opportunities for millions of people in India.

Further, when the output of goods and services from government enterprises increase, then private enterprises which receive raw materials from government enterprises will also raise their output and hence increase the number of employment opportunities in the economy. For instance, when a government-owned steel company increases its output, it will result in a direct increase in employment in that government company, simultaneously, private companies, which purchase steel from it will also increase their output and thus employment. This is the indirect generation of employment opportunities by the government initiatives in the economy.

There are many programmes that successive governments have implemented to alleviate poverty through employment generation. They are known as Employment Generation Programmes.

They are as follows:
Self-employment programmes: The major Self Employment Programmes are:

1. Swarnajayanti Gram Swarozgar Yojana (SGSY): This programme aims at providing financial assistance to self-help groups which then decide whom the loan is to be given to for self-employment activities among the members.
2. Swarnajayanthi Shahari Rozgar Yojana (SJSRY): It aims at creating employment opportunities, for both self-employment and wage employment opportunities in urban areas. Under self-employment programmes, financial assistance is given to families or individuals. Now, programmes are encouraged to form self-help groups.
3. Pradhana Manthri Rozgar Yojana (PMRY): The educated unemployed from low-income families in rural and urban areas can get financial help to set up some enterprise that generates employment under this scheme.
4. Wage employment programmes: The major national programmes to generate wage employment are as follows:
5. National Food for Work Programme (NFWP)
6. Sampoorna Grameena Rozgar Yojana (SGRY)
7. Mahatma Gandhi National Rural Employment Guarantee Programme (MGNREGP): It provides guaranteed wage employment to every household whose one adult volunteer will get unskilled labour for a minimum of 100 days in a year.

All these programmes aim at providing not only employment but also services in areas such as primary health, primary education, rural drinking water, nutrition, assistance for people to buy income and employment generating assets, development of community assets by generating wage employment, assistance for constructing houses, laying of rural roads, development of wastelands.

Question 5.
Explain the occupational structure of the workforce.
Answer:
The sectoral distribution of the workforce in India can be explained with the help of the following table:


The primary sector is the main source of employment for the majority of workers in India. The secondary sector provides employment to only about 24% of the workforce. About 27% of workers are in the service sector. The above table shows that about 64% of the workforce in rural India depends on agriculture, forestry and fishing. About 20% of rural workers are working in manufacturing industries, construction and other industrial activities. The service sector provides employment to only about 16 % of rural workers.

Agriculture is not a major source of employment in urban areas where people are mainly engaged in the service sector. About 60% of urban workers are in the service sector. The secondary sector gives employment in about 35% of the urban workforce.

The following table shows the status-wise employment pattern in India which include self-employed, regular salaried employees and casual wage labourers during 2011 -12 in percentages.

Status	Percentage of workforce
Self-employed	52
Regular salaried employees	18
Casual wage labourers	30

From the above table, it is clear that self-employment is the major employment provider with 52%. But, the casual wage employment with 30%, shows that there is also a gradual increase in the number of casual wage labourers. The process of moving from self-employment and regular salaried employment to casual wage work is called casualisation of the workforce.

Question 6.
Discuss the in-formalisation of the Indian workforce.
Answer:
In formalisation of the workforce is the process where companies or employers are trying to employ them, workers, without assuring job security, provident, gratuity, ESI, periodical pay hike, etc. – Some well-established firms are converting their employment structure from formal to informal to avoid the risk of labour laws. This is known as the in-formalisation of the workforce.

The following is a live incident of formalisation which happened in Ahmedabad during the 1980s.

Like, Bengaluru, Ahmedabad is a well-developed city with more than 65 cotton textile mills having more than 1,60,000 workers. These workers had job security with decent wages and also all the workers were covered by Social Security Schemes protecting their health and old age. There was also a strong labour union to resolve disputes and to provide welfare measures to the mill workers.

During the 1980’s textile, mills all over the country began to close down. In some places, like Mumbai, the mills closed rapidly. In Ahmedabad, the process of closure was long drawn out and spread over 10 years. Over this period, about 80,000 permanent workers and about 50,000 casual workers lost their jobs and were driven to the informal sector. The city experienced an economic recession and public disturbances, especially communal riots. A whole class of workers was thrown back from the middle class into the -informal sector, into poverty. There was widespread alcoholism and suicides, children were withdrawn from school and sent to work.

The following are the major problems faced by workers in informal workers:

• It does not ensure job security
• Workers and enterprises do not get regular income
• The workers do not have any protection of regulation from the government
• Workers are dismissed without any compensation
• The technology used is outdated
• They concern not maintain any accounts
• Workers in this sector live in slums and are squatters
• Poor working conditions
• It does not ensure social security measures like pension, bonus, maternity benefits
• Employment became seasonal and temporary.

VII. Project-oriented question (5 Marks)

Question 1.
Identify the formal and informal workers in the following list.
1. A petty shop owner
2. Handloorn weaver
3. SRI cashier
4. A street vendor
5. Government Hospital Nurse
6. Government primary school teacher
7. Tailor
8. Revenue inspector
9. Sub-inspectors Police
10. Agricultural labourers
Answer:
(a) Petty shop owner – informal worker
(b) Handloom weaver – informal worker
(c) SBI cashier – formal worker
(d) A street vendor – informal worker
(e) Government hospital nurse – formal worker
(f) Government primary school teacher – formal worker
(g) Tailor-informal worker
(h) Revenue inspector – formal worker
(i) Police-formal worker
(j) Agricultural labourers – informal workers.

1st PUC Economics Question Bank with Answers