Self employment in India:-
- Nearly half of the labor force is self-employed in India.
- In India a self-employed person is anybody who is working for oneself instead of working for a wage or salary.
- Lack of suitable jobs and the lack of suitable avenues for investment, people opt for self-employment.
- Self–employment programs emerged as an important bridge from unemployment to sustainable economic activity
- Advantage of small business
- The self-employment involving activities on a small-scale is a good alternative to large scale business which has brought various evils like environmental pollution, development of slums, exploitation of workers, and so on.
- Preference over wage employment
- In self-employment there is no limit of earnings as is the case with wage employment. In self-employment one can use one’s talent for own benefit. The decisions can be taken quickly and conveniently.
- Developing the spirit of entrepreneurship
- Self-employment involves either no risk or very little risk. But, as soon as the self-employed person starts becoming innovative and takes steps to expand his business it becomes a launching pad for entrepreneurship.
- Promotion of individualised services
- Self-employment may also take the form of providing individualised services like tailoring, repair work, dispensing of medicines etc. Such services are helpful in providing better consumer satisfaction.
- Reducing the problem of unemployment
- Self-employment provides opportunities of gainful occupation to those who otherwise remain unemployed. Thus it reduces the problem of unemployment.
- An entrepreneur is not just creating self employment but also building a structure for small to large scale employment. As these enterprises grow, the employment opportunities increase. In India, many start-ups that started out as home based ventures are today employers to hundreds of individuals.
- Women who are self employed are financially secure leading to growing role of women in India’s labour force and shift towards gender equality.
- Self employed are mostly part of informal economy with no necessary protection.
- It is relatively easier to evade taxes for the self-employed than in the case of true entrepreneurs who operate with the help of independent-minded professionals, possibly on a large scale, which makes tax evasion difficult.
What needs to be done:-
- India needs to reduce bad self-employment by massively creating formal, non-farm, wage employment and good self-employment. There need to be reforms of building infrastructure, reducing regulatory control, and raising human capital.
- Reforms in labour laws ,education needs to be undertaken immediately for encouraging good self employment.
Source – Livemint