Abstract
This chapter explores the character of the local rural–urban labour market, testing theories of labour market mobility and segmentation using a substantial survey from 1999 to 2000 along with field case material both in Arni and in nearby ‘suburban’ villages. It focusses on the commonest form of work in India accounting for 60 % of Arni’s workforce—self-employment—distinguishing it from wage labour (with which it is often conflated in labour economics and law). The social origins of petty-producing and trading firms are analysed along with the patriarchal domination of their respective households. Occupational reproduction is found to be substantially determined by caste; and social discrimination significantly restricts occupational and sectoral mobility. Self-employment expands by multiplication rather than accumulation. Arni’s ‘markets’ show clear evidence of persistent rural–urban, occupational–sectoral social and economic segmentation.
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Notes
- 1.
While members of a household labour force working for pay such as domestic maids, drivers are defined as ‘hired workers’, relatives or family members who work in an enterprise run by the head of a household, share food cooked within the house and who are not paid wages are ‘home workers’.
- 2.
- 3.
Labour mobility is defined as ‘the movement of labour between jobs, including all changes in the employment or job status of a worker that alter his function or his location in the productive and distributive framework.’ See Hunter and Reid (1968), p. 12.
- 4.
See Harriss-White (2012).
- 5.
This is known as the ‘Labour Turnover Model’ (see Stiglitz 1974).
- 6.
In fact, no less than Adam Smith stated that the laws and regulations concerning the apprenticeship system and the practices of what is called ‘unincorporated trade’ were a serious impediment to labour mobility either within the same establishment or from one establishment to another similar one. See Smith (1789, p. 122).
- 7.
Transactions costs are the costs of seeking, cementing and enforcing the contracts that link supply and demand.
- 8.
Also see Teiolhet-Waldorf and Waldorf (1983).
- 9.
Expected real income was defined as the product of the formal sector wage and the probability of finding a job in this sector. See Harris and Todaro (1970).
- 10.
- 11.
See Mazumdar (1989).
- 12.
- 13.
In the present study, this group is part of the self-employed workers.
- 14.
See Banerjee (1986).
- 15.
According to Banerjee, “the amount of mobility depends, among other things, on the time span over which it is measured, and on the state of the labour market. Mobility should be higher the longer is the time span over which it is measured, and during a period of urban job expansion.” See ibid, pp. 154–156.
- 16.
- 17.
Well pointed out by Chen et al. (2006).
- 18.
- 19.
Marital status and second jobs were exceptions to this and were found to influence workers’ earnings significantly.
- 20.
Badli is a form of contract work practised in the organized sector textile industry in Bombay and other cities in which workers were temporary employed by textile mills in place of (or due to the absence of) permanent or probationary workers. Over the course of time, textile cities had a pool of these workers as a reserve workforce. They were given passes by the mill management. They arrived at the mill gate at the shift time and got work depending upon the number of permanent workers who did not turn up. Their monthly wages were much lower than that of their permanent counterparts.
- 21.
Not all mobility between formal and informal work is constrained. As explained earlier, labour market theory is intertwined with explanations for migration. Migration models predict that workers—both self-employed and hired—wait in the informal sector with the expectation of entry into the formal sector as hired workers. Slum dwellers in Delhi are reported to have moved from low income hired employment to high income regular jobs (Mitra 2006).
- 22.
Together with labour market rigidities this lowers the correlation between ability and remuneration for wage workers.
- 23.
A difference in the estimation of the self-employed in India and in other countries is that in India the unpaid family workers are included as a category of self-employed while in other countries they have a separate category. In some developed countries self employed workers are restricted to own account enterprise operators.
- 24.
- 25.
Hamletization is a sampling procedure followed by the National Sample Survey Organisation (NSSO) to choose a small number of households representing a variety of workers and enterprises by recognizing ‘hamlets’. There are two methods by which ‘hamlet formation’ is done for purposes of sampling. In the first method, if the field worker finds a number of ‘natural hamlets’, constituted by groups of households which reflect identifiable social neighbourhoods, one hamlet is chosen among them randomly and then a listing is completed. The limitation of this method is that the hamlets chosen for listing may consist of a considerable proportion of households engaged in one specialized activity. This may lead to biased results. Also though natural hamlets were chosen randomly, it is possible that these hamlets omit some prevalent activities, which may lead to the underestimation of workers in particular economic sectors. This problem is a common one in India where people reside in caste- or community-based localities. It is common to find scheduled castes, who are mostly working as agricultural labourers, residing in separate settlements. To overcome this problem, another method is adopted. Suppose a village or town has 1000 households in which the researcher has resources to list 200. The required 200 households will be listed by moving systematically from door to door of every fifth house in each neighbourhood. Even if the natural hamlets which constitute the village consist predominantly of households with one particular activity, the households listed from all the neighbourhoods would together represent the village or town reasonably well because the listing was carried out throughout the entire town or village. Listed households will then be combined to form an ‘artificial hamlet’ which will represent the whole village or town.
- 26.
See the doctoral thesis of Srinivasan (2010) for the details of research design and methodology.
- 27.
In some parts of the discussion, self-employed household heads are considered, while in others the analysis will refer to all who have reported themselves as self-employed workers in Arni. This has been done due to the non-availability of data from self-employed workers other than household heads.
- 28.
- 29.
The Census of India defines main workers as those workers who had worked for the major part of the reference period (i.e. 6 months or more). See: http://censusindia.gov.in/Metadata/Metada.htm. Kalpagam (1994) defines patriarchy as “a social system where the prevailing ideology of gender relations is such that the man is recognized to be provider and protector of the family”. See also Kalpagam (1994), pp. 81–82.
- 30.
The NSSO (2001) defines establishments as those enterprises, which employ at least one hired worker on a ‘fairly regular basis’. The term ‘fairly regular basis’ means that the major part of the period of operation(s) of the enterprise during the last 365 days.
- 31.
It is also quite common in Arni for male members to work as regular salaried employees in public sector establishments but also to manage private enterprises, maintaining the registration and accounts in the female family members’ names as benami—denoting a transaction or property right made out in a false name.
- 32.
Harriss (1990).
- 33.
A typical casual wage labourer in Arni earned Rs. 1176 per month, her public sector regular salaried employee earned Rs. 7745 per month. The earnings of the private sector regular salaried employee was only just above that of casual wage labourer at Rs. 1433 per month. See Srinivasan (2010).
- 34.
Three important aspects which may have led to this situation are (i) the caste mobilization of Vanniyars through their Vanniyar Sangam which later become the Pattali Makkal Katchi and its successful struggle to gain reservations for jobs and access to higher education institutions under a new official rubric of Most Backward Castes (MBCs); (ii) the consolidation in Tamil Nadu of Scheduled Castes particularly Adi Dravidars through the Vidudhalai Chiruthaigal Party; and (iii) welfare schemes initiated in the 1980s by the then Chief Minister M.G. Ramachandran, when leader of the All India Anna Dravida Munnetra Kazhagam (AIADMK) which brought a large group of children into schooling.
- 35.
Discussed in Corbridge et al. (2013).
- 36.
Another criterion is evidence of earnings gaps, other things being equal—see Srinivasan (2010) for details which are summarized later.
- 37.
Due to paucity of space, all the tables are not reported. See for details Srinivasan (2010), pp. 165, 167, 168 and 171.
- 38.
Gumastha is a common term used in Arni by employers to denote regular salaried assistants who carry out a variety of skilled tasks including accounting.
- 39.
In this subsection, the term ‘jobs’ has been used to denote all activities in both self-employment and hired work.
- 40.
See Kumar et al. (2002a, b), Harriss et al. (1990), Mitra (2006). In these mobility tables, the details of worker status in their first jobs are cross-tabulated against their status in current jobs. For purposes of comparison, the absolute numbers arrived in the cross tabulation are converted into percentages.
- 41.
Directory and non-directory enterprise operators have over and under 6 employees respectively.
- 42.
The mandi is a market site for a particular commodity, commonly food grains or groceries where producers sell their produce directly. Firms in mandis also act as commission agents between sellers (producers) and buyers.
- 43.
A thotti karar is a small rice manufacturer who hires-in rice mill machinery and the mill premises.
- 44.
Sixty-five percent of those who entered silk weaving belong to weaving castes, a similar proportion in rice milling enterprises are Agamudayars, and 54 % of those who entered other services sectors hail from service castes.
- 45.
See Srinivasan (2010) which uses scatter diagrams, cross-tabulation and coefficients of variation.
- 46.
For instance, coefficients of variation are very low among illiterate and graduate workers and high among primary level literate workers.
- 47.
They are Labbai and Ashraf. In Tamil Nadu, the members of the first one are classified under Backward Classes and the second one under Other Castes.
- 48.
They are members of Scheduled Castes who were converted to Christianity and those from other castes (Velalars, Naadars, Brahmins etc.). It was reported during the field survey that these two groups maintain separate churches and there is no inter-marriage between these Christian groups. Both of them are classified under Backward Classes.
- 49.
A very small number of Marwari firms can be found in Arni’s pawnbroking cluster.
- 50.
The details of the enterprise categories are given in the notes for Table 3.2.
- 51.
Sanghera and Harriss-White (1995).
- 52.
This is true not only in trading but also in other enterprises.
- 53.
See also Harriss-White (2005).
- 54.
It was reported that one Adi dravida gumastha who worked with a banana wholesaler (which is normally not allowed by the caste Hindus and only to a certain extent by Labbai Muslims in recent times) has become a commission agent in bananas. Muslims set up commission agencies to counter the competition from Hindu backward caste wholesalers. This also has encouraged Adi dravidars to expand and sustain their fruit retailing businesses.
- 55.
The coefficient of variation is 16.
- 56.
The coefficient of variation is 55.3.
- 57.
The coefficient of variation is 116.
- 58.
Pagudi is a one-time advance given for renting the buildings in temple or municipal complexes. It is generally given to the intermediary who has originally rented the premises. The advance is the amount fixed by owner of the building.
- 59.
See Harriss-White (2013) for details of payment asymmetries in Arni going back to the 1970s.
- 60.
The ‘backward class’ accounts for about 60 % of self-employed household heads in Arni. The term ‘backward class’ refers people belonging to groups of castes classified by the Government of Tamil Nadu as entitled to receive various kinds of welfare measures and reserved quotas for public sector jobs in Tamil Nadu. In Arni, the backward class group consists of 21 caste groups. About 143 castes are included in backward classes, 36 castes are included in scheduled castes, 41 caste groups are listed under most backward classes and 41 castes are listed under Denotified Communities. See GoTN (n.d.). It has been argued that even before Independence, the social reforms initiated by E.V. Ramasamy (alias Periyar) through the Self Respect Movement and the implementation of positive discrimination policies (such as reservation for government jobs to backward class caste groups) could have led to a change in the wealth distribution tilting towards backward classes (see Lakshmanan 1990). This group includes members of locally dominant castes who are rich as well as numerous, plus others in the population such as agamudayars, rich castes which are few in number such as Naidus, Chettiyars and Vaaniyars and middle income castes such as Sengunthars. Vaaniyars—also called Vaaniya Chettiyars are different from Vanniyars. While the former are similar to traditional baniya trading communities in North and Western India, the later are an agricultural labouring and peasant caste-community specifically located in a few areas of Tamil Nadu.
- 61.
The mean monthly income of a typical backward class self-employed household head was Rs. 10,520 with a coefficient of variation of 190.44. It was Rs. 2,786 (with a coefficient of variation of 75) for other caste groups.
- 62.
Rs. 2,864 per month and coefficient of variation is 86.
- 63.
Rs. 2,745 per month with a coefficient of variation of 76.
- 64.
Coefficient of variation is 94.
- 65.
Coefficient of variation is 59
- 66.
Coefficient of variation is 76.
- 67.
Coefficient of variation is 0.04.
- 68.
Coefficient of variation is 91.
- 69.
They constitute the largest section (35 %) among the 21 castes classified as backward class.
- 70.
It was Rs. 281,000 with a coefficient of variation of 406.
- 71.
It was Rs. 52,450 with a coefficient of variation 193.
- 72.
- 73.
In the hierarchy of incomes by industry group, rice millers are the richest group in Arni. Their high incomes are earned mainly on the strength of inherited wealth and the current value of assets is very high. Traders, it may be remembered, ranked second in terms of relative prosperity and their earnings are systematically higher than those in other sectors (Srinivasan 2010).
- 74.
- 75.
Silk merchant.
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Srinivasan, M.V. (2016). Arni’s Workforce: Segmentation Processes, Labour Market Mobility, Self-employment and Caste. In: Harriss-White, B. (eds) Middle India and Urban-Rural Development. Exploring Urban Change in South Asia. Springer, New Delhi. https://doi.org/10.1007/978-81-322-2431-0_3
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