Focus Shifts to Informal Sector

informal sector

With over 90% of the working population in India classified informal, with little skills and no job security, it comes as no surprise that the government is extending its focus and mission to Skill India to the informal sector with an annual budget of Rs 5,000 crores. 

Unless skills training and development of the informal sector goes hand in hand with skilling the organised sector, success on the ground for Skill India will be missed by a large margin, believes the Ministry of Skill Development and Entrepreneurship. 

“For the last five years, the Ministry has focused on skilling manpower for 7 percent of the workforce who are in the formal sector. What happens to the rest of the 93 percent? This is a big realisation moment for the Ministry and allied 22 government departments with some skilling agenda. The focus now will gradually shift to the informal and unorganised sector,” a government official has said.

Also Read Why Upgrade Informal Apprenticeships

Another government representative reports that the Skills Ministry and the Ministry for Rural Development can collectively contribute Rs 4,000 crores annually for skilling the informal sector. With all government departments chipping in, the spending power can reach Rs 5,000 crores to support SMEs in skilling their manpower.  With at least 80 percent of the country’s workforce engaged in firms with less than six employees the focus on SMEs is of indisputable importance. For grass-roots development to take place, skills training needs to reach far and wide. Micro-entrepreneurs are key to driving employment in smaller towns, cities and SMEs. Hence, training manpower in all forms of businesses, from a motor garage to a small printing press, will define the success of national skilling initiatives. 

The India Apprenticeship Forum has long stressed on the importance of skills training of the informal sector. Read our articles:

Tackling Informality in the Workforce with TVET

Skilling Formal and Informal Economy Hand-in-Hand