Q.1. Discuss the issues relating to formal and informal sector employment . Expalin , how privatisation has led to informalisation of workforce in india ?

Formal sector refers to the organised sector of the economy. It includes all the government departments, public enterprises and private enterprises that hire 10 or more workers. The workers in a formal sector generally work as regular-hired workers. Also, the workers in this sector are entitled to various social security benefits such as provident funds, etc. As against this, informal sector is the unorganised sector of the economy that includes all private enterprises hiring less than 10 workers, besides farming and self-employment ventures. Workers in the informal sector generally work as casual workers. They are not entitled to any of the social security benefits.  

Informalisation of workforce refers to a situation where there is a continuous decline in the percentage of workforce in the formal sector along with simultaneous rise in the informal sector’s workforce. Recently, India witnessed this phenomena.The growth process triggered by privatisation relied more on the modern and efficient technology rather than labour for the production of goods and services. As a result, the employment in the formal sector remained low and that in the infomal sector increased.