The informal economy is classified and can be grouped into two parts. One group consists of workers who are employed in the formal sector as daily wage or casual workers including individuals and entrepreneurs that might undertake piecework in their own premises, street vendors and most domestic workers. The other group consists of enterprises existing in the informal sector which comprise micro enterprises, hawkers, small traders, road side vendors who are engaged in spot market transactions with buyers, sellers and customers depending upon the kind of work they are performing. While it is hard to track India’s large informal sector, there are estimates that this sector employs around 80 per cent of the labour force and produces about 50 per cent of GDP. As per the estimates more than 40 crores are employed in the informal sector, half of them work in agriculture, living mostly in rural India and the other half are in non-agriculture sectors.
Despite this strength and opportunity, India has not optimally leveraged and untapped the potential of this sector. This sector is unable to seek credit in a formal way and has limited access to social programs. Their social exclusion has challenged them with the issues of productivity enhancement. Automation and skill upgradation are always left to operate on thin margins. This sector is so vulnerable that it lacks the social security of their workers.
However, if we look at the formal sector the picture is very different. Formal sector which engages meagre number of workforce, has access to almost all the schemes, policies and benefits.
Engaging the informal sector and unleashing its potential can be a game changer for India. Informal sector and informal workers are the key engines for the growth of our country. Some of the sectors have statistically indicated a huge growth in employment opportunities in the next few years. More jobs that will get created over the next five years will be largely in the informal sector. Therein lies the opportunity to skill the informal workforce, enhance their wages and enable their transition to better jobs and micro-entrepreneurship.
According to the Economic Survey 2018, “93 per cent” of the total workforce in India is from the informal and unorganised sector. According to an estimate, the total workforce in the country is 45 crores. Out of this, 93 per cent i.e. the number of people working in the unorganised sector of the country is about 41.85 crore. One of the key engines of this growth will be the informal workforce. Besides the obvious areas of growth like construction and retail, sectors like tourism and hospitality, apparel, weaving, furniture and furnishings, and warehousing and logistics will each add more than 500,000 informal workers every year.
Evolution of Apprenticeship Policy
While many interventions can be explored and identified, one area that can transform this informal sector is the revival of the age-old guru shishya parampara. In ancient Gurukul days, this relationship for potential skilling and employability were covered under various doctrines. While in contemporary times, we have NAPS (National Apprenticeship Promotion Scheme) that covers and benefits the formal sector and employers, there is no existing policy that can facilitate apprenticeship in the informal sector.
The apprenticeship policy in India has evolved over the years. The Apprentices Act, 1961 and Apprenticeship Rules,1962 were enacted with the prime objective to fully utilise the facilities available in industries for imparting practical training. The Ministry of Skill Development and Entrepreneurship has also launched the National Apprenticeship Promotion Scheme to further incentivise and popularise apprenticeship in India. All these efforts are aimed at promoting apprenticeship in the formal sector.
In spite of such initiatives there are still a lower number of apprentices in India. We have a substantially lower number of apprentices and a large labour force compared with other countries. There is a mismatch between demand and supply of apprentices, from the demand side the issue is related to seeking apprenticeship training while from the supply side the issue relates to the employability of the existing workforce due to several socio-economic factors.
Reviving guru shishya parmapara in a more formal way that suits the needs of this contemporary world can be a game changer.
In ancient times, ‘Narad Smriti and Viramitrodaya’ doctrines defined the complete framework of a Apprenticeship with rules, regulations and guidelines to be followed in the vocational education where young men worked as apprentices under a master. The master craftsmen made an agreement to let the apprentices stay till the skill is acquired by him or her. The agreement also fixed the respective obligation of both master and apprentice during the time of the training. The advantage of the ancient system of vocational education through apprenticeship was that the apprentice always worked under his Master’s eye and had opportunities observing the special points of the skills, the trade secrets and imbibing his true method and genius as the ultimate factor of success of its craftsmanship.
Reforming Informal Sector
The strength of non-formal apprenticeship lies in its flexibility and organisational form. Non- formal apprenticeship strives to provide education at the grassroots level from the grassroots level itself, with the help of people familiar with the conditions and situation in respective occupations. This is in contrast to formal education stemming from the principle of ‘from the top downwards’ and predetermined curriculum which is the same for all. Most informal sector workers who possess skills have acquired them through non-formal training or traditional education/informal training outside the State schemes of formal education. Informal training and learning-by-doing often play the most significant role in providing workers of the informal sector with skills.
The system of the “guru -shishya” (mentor – mentee) system is a centuries old system of transferring skills from generation to generation. It is mutually beneficial for both gurus (masters) and shishya (apprentices) should be reinforced. This can be implemented by recognising prior learnings (RPL), competencies of the skilled artisan and by providing a certificate and monetary reward on successful completion of assessments, acknowledging them as Trade Gurus through a process of Master Craftsman Trainer certification and then further Incentivising these Certified Trade Gurus to engage apprentices for apprenticeship-based skilling. Apprentices can be assessed and certified at the end of the 6 Month apprenticeship through a process of apprenticeship assessments.
This Apprentices become skilled workers once they have acquired the knowledge and skills in a trade or occupation, which helps them in getting wage or self – employment and can be linked to govt soft loans/ micro finance schemes. This coherent but flexible policy for RPL plus apprenticeship-based skilling for the youth in the state of Haryana can be aligned with Parivar Pehchan Patra (PPP) scheme so as to ensure consistency and reliability and at the same time enabling automatic selection of beneficiaries. The primary objective of PPP is to create authentic, verified and reliable data of all families in Haryana. Once the data is sought from PPP, it will be further sifted and sorted by conducting local surveys and organising camps for mobilisation of potential willing candidates.
Subsequently youth registered on PPP can be engaged for Apprenticeship Based Skilling for Certification and Creation of livelihood Opportunity to acquire competence through apprenticeship, which otherwise would only be possible through more formal educational schemes. It can, in the ideal case, allow for flexible and dynamic skills transmission that is self-regulating. Apprenticeship does not require much initial skills or experience from the apprentice, but only the willingness to undertake training and an agreement with a willing master, who will be a certified Guru. Many families and youth migrate from villages to larger towns and cities in search of livelihood as trades, crafts and arts are not being passed on due to lack of economic incentives and breaking down of traditional Guru Shishya System. These migrants engage in various informal occupations such as food hawkers, street side vendors, masons, painters, carpenters, auto mechanics, dhabha workers, cooks, idol makers, jewellery makers, metallurgy workers, electricians, plumbers, to name a few.
If their skills were formalised, they can be easily accommodated in organised construction, paint, food, jewellery and automotive, plumbing, electronic sectors, etc. as most of these job roles are already defined in these organised sectors.
There are also many traditional arts and occupations in India which can immensely benefit from knowledge transfer through the Guru Shishya System if appropriate economic incentives are introduced and the skill sets possessed by the Guru are recognised. This will reduce the migration from villages and strengthen the local rural economy, tying in to the government’s goal of “Vocal for Local”.