A major worrisome trend is the relentless informalisation of work in the formal sector. Thus, as per the NSSO estimates of 2011-12 (which is the latest available estimate), count of informal labour was a whopping 447.2 million out of a total labour force of 484.7 million. Most of these workers can be classified as 'vulnerable' who work in insecure jobs with negligible social protection. As already noted, informality and vulnerability has been on the rise, despite, relatively high economic growth rates of GDP; withdrawal of the Indian state from several key areas in the social sector has only aggravated the vulnerability of the working class.

While the total employment in the organized sector has grown from 38.89 million in 1999-2000 to 81.6 million in 2011-12, the informal jobs within the organized sector increased from 15.95 million to 47.20 million during the same period. In fact, the share of ‘informal’ workers in the ‘formal’ sector increased from about 30 per cent towards the end of 1990s to about 58 per cent as per the most recent estimates of the NSSO. This indicates that an overwhelming majority of the new jobs generated in the organized sector in the last decade are informal in nature so that at present informal jobs constitute 58% of the organized sector employment. In sum, an overwhelming majority of workers are in casual wage employment or in self- employment, and most of them are trapped in extremely insecure work and living conditions, characterizing informal employment. It is also important to emphasize that the prospects of upward mobility for most of them are severely limited.

Although there has been some increase in employment of women in regular work in recent years, studies have shown that this growth is primarily taking place in community and personal services of which domestic work forms a considerable segment. The latest data of the Labour Bureau shows that while the participation rate for males in the most productive age group (18-29 years) in 2014 is 70.1, it is at an abysmally low figure of 29.4 for females.

The poverty head count for the workers of most oppressed castes like Dalits, is among the highest in the informal sector, and this is a function of the type of employment and discrimination across different axes that they are subjected to. The overwhelming majority of socially marginalized groups cannot get beyond manual, ‘menial’ and shop floor work.

The Arjun Sengupta Committee report said that more than 80 per cent of the country’s workers fall under the category of the ‘poor and vulnerable’ which meant that their daily per capita total consumption, at 2004-05 prices, was 20 rupees or less than that. There is no evidence of any significant improvement in the well-being of workers during the era of so-called economic reforms.

The growing trend of informalisation is reinforcing the duality and disparity between organized and unorganized sectors and between formal and informal employment. The process of structural transformation in the economy (moving people from low-productive to high-productive employment) is hindered by this growing disparity and inequality. Any labour reforms must aim to contribute to the reduction of this disparity by reversing the process of informalisation and by encouraging formalization of informal employment. Deregulation (reducing government intervention) or unleashing market forces will only lead to phenomenal increase of vast army of unprotected employees and may, in fact, aggravate it further.

Hence, the key and real issue is to enact legislations to protect informal work force in formal and informal sectors. Only a miniscule minority of around 7 percent of entire working class in the country is protected by a plethora of legislations which is also being scrapped now. Even multinational companies are only employing contract labour or trainees. Some companies employ trainees only for a day less than 6 months and send them out. There are many MNCs and corporate companies which employ only 5 percent of workers as their regular employees which is only the band of managerial staff and very few regular workers. In such a context, making hire and fire easier for the industries is only beating around the bush.

Hire and Fire may automatically become easier when there are abundant or alternative avenues of job. But, in Indian scenario, where unemployment rate is very high and employment generation is in the negative, making hire and fire easier can only help to create vast army of unemployed that is already becoming a social and political issue.

Underemployment, self-employment or vulnerable employment is a major problem in the country. The government is only talking about increasing it more with ‘pakodawalah’ model of self-employment and reducing formal, suitable and skilled employment. The human capital, which is an asset of the country, is being squandered.