people as a resource
People as Resource
‘People as Resource’ refers to a country’s working people in terms of their existing productive skills and abilities.
Like other resources, the population is also considered a human resource.
This perspective emphasizes the population's ability to contribute to the creation of the Gross National Product.
Viewing population as a 'human resource' is the positive side of a large population, often overlooked when focusing only on problems like food, education, and health access.
The chapter 'People as Resource' aims to explain population as an asset for the economy rather than a liability.
Human Capital Formation
When the existing ‘human resource’ is further developed by becoming more educated and healthy, it is called human capital formation.
Human capital is the stock of skill and productive knowledge embodied in people.
Human capital formation adds to the productive power of the country just like 'physical capital formation'.
Investing in human beings in the form of health, education, and skills leads to human capital formation.
Proper human capital formation is essential for humans to become capital.
Investment in Human Capital
Investment in human capital occurs through education, training, and medical care.
This investment yields a return just like an investment in physical capital.
Returns can be seen directly in the form of higher incomes due to increased productivity of educated or trained individuals and healthier people.
Society also gains indirectly from a more educated or healthier population, as the advantages spread to those not directly educated or given healthcare.
A child with investments in education and health can yield a high future return through higher earnings and greater societal contribution.
Educated parents tend to invest more in their children's education, recognizing its importance and being aware of proper nutrition and hygiene, creating a virtuous cycle.
Superiority of Human Capital
Human capital is superior to other resources like land and physical capital.
Human resource can make use of land and capital, whereas land and capital cannot become useful on their own.
The importance of human capital has come to acquire a higher position than that of material, plant, and machinery, as seen in India’s IT revolution.
Economic Activities
The activities in Economics are divided into three sectors: primary, secondary, and tertiary.
Primary Sector: Includes agriculture, forestry, animal husbandry, fishing, poultry farming, mining, and quarrying. These are nature-related activities.
Secondary Sector: Includes manufacturing. This involves processing and manufacturing.
Tertiary Sector: Includes trade, transport, communication, banking, education, health, tourism, services, insurance, etc.. This sector provides services.
These activities are termed economic activities. They result in the production of goods and services and add value to the national income.
Economic activities have two parts: market activities and non-market activities.
Market activities involve remuneration to anyone who performs, i.e., activity performed for pay or profit. These include the production of goods or services, including government services. Transactions are involved.
Non-market activities are the production for self-consumption. These can be the consumption and processing of primary products and the own-account production of fixed assets. Examples include going to a temple or cooking for oneself.
Division of Labour (Men and Women)
Historically and culturally, there has been a division of labour between men and women.
Women generally look after domestic chores, and men work in the fields.
Men were paid for their services, but to the contrary, women were often not paid for their services in household work.
Household work done by women is not recognized in the National Income.
However, women are paid for their work when they enter the labour market, such as Geeta selling fish.
Women with high education and skill formation were paid highly, at par with men.
In organized sectors, teaching and medicine attract women the most.
Some women have entered administrative and other services requiring high levels of scientific and technological competence.
Even when both men and women perform market activities, there can be disparities in remuneration, with women often receiving less pay.
Role of Education
Education plays an important role for individuals to make better use of economic opportunities.
It is a major determinant of an individual's earning in the market.
Education contributes to the growth of society, enhances the national income and cultural richness, and increases the efficiency of governance.
Literacy is needed for citizens to perform their duties and enjoy their rights properly.
Sakal's education in his initial years yielded benefits later in the form of a good job and salary.
Education opened new horizons for Sakal, provided new aspirations, and developed values of life.
Investment in education is crucial for human capital formation and makes the population productive for the country.
Countries like Japan, despite lacking natural resources, became rich by investing in education (and health).
Women in the Workforce (Security, Pay, Skills)
Most women used to work in places where there was no job security.
Employment in this sector was characterized by irregular and low income.
Basic facilities were often missing, like maternity leave, childcare, and other social security systems.
However, women with high education and skill formation were paid highly, sometimes at par with men.
If women are educated and skilled, they can earn good money, and in fields like administration, they might not face gender-based pay discrimination.
A majority of women have meagre education and low skill formation. Women are paid low compared to men.
Quality of Population
The quality of the population depends upon the literacy rate and health of a person, indicated by life expectancy and skill formation acquired by the people of the country.
It ultimately decides the growth rate of the country.
A literate and healthy population is an asset.
Whether a country's population is an asset or a liability depends on how qualitative it is, which in turn depends on education and health.
Factors Determining Population Quality (Literacy, Health, Skills)
Literacy rate is a key factor in determining the quality of the population.
Health of a person, indicated by life expectancy, is another crucial factor. A healthy population can work better.
Skill formation acquired by the people is also a vital aspect of population quality. Knowledge and skills are gained through investment in education and training.
Impact of Population Quality on Growth
The quality of the population ultimately decides the growth rate of the country.
A literate and healthy population is an asset that contributes positively to economic growth.
Increased productivity from a healthy and educated population adds to the growth of the economy.
If proper human capital formation occurs, a large population can be productive for the country rather than a liability.
Unemployment, resulting from poor population quality or lack of opportunities, can turn the population from an asset into a liability and hinder economic growth.
Sarva Shiksha Abhiyan
Sarva Shiksha Abhiyan was introduced in the year 2010 (source states 2010, while source mentions aiming for elementary education by 2010 and being a time-bound initiative) and is a significant step towards providing elementary education to all children in the age group of 6–14 years.
It is a time-bound initiative of the Central government, in partnership with the States, the local government, and the community, for achieving the goal of universalization of elementary education.
Mid-Day Meal Scheme
A mid-day meal scheme was introduced to encourage attendance and retention of children in schools and improve their nutritional status.
12th Five Year Plan Focus on Education
The 12th plan focused on increasing access, quality, adoption of state-specific curriculum modification, vocationalization, and networking on the use of information technology, distance education, and convergence of formal, non-formal, distance, and IT education institutions.
Priority of Health Improvement
Improvement in the health status of the population has been the priority of the country.
A healthy person can realize their potential and fight illness, maximizing their output and contributing to the organization's growth.
Health is an indispensable basis for realizing one’s well-being.
National Health Policy Aims
The National Policy aimed at improving the accessibility of healthcare, family welfare, and nutritional service, especially for the underprivileged segment of the population.
Development of Manpower in Sectors
India, over the last five decades, has developed its manpower required in the primary, secondary, and tertiary sectors.
Unemployment (Rural and Urban)
In India, there is unemployment in both rural and urban areas.
The nature of unemployment differs in rural and urban areas.
When people who are willing to work at the going wages cannot find jobs, unemployment is said to exist.
People are considered unemployed if they are willing to work at the ongoing rates but cannot find work.
The workforce population includes people from 15 years to 59 years.
Rural Unemployment (Seasonal and Disguised)
In rural areas, unemployment is often seasonal and disguised.
Seasonal unemployment occurs when people are not able to find jobs during a few particular months of the year. People dependent on agriculture usually face this, with busy seasons for sowing and harvesting and less work in other months.
In disguised unemployment, people appear to be employed but are not fully utilized. This often happens among family members in agricultural activity where more people are engaged than needed, and removing some would not reduce productivity.
Urban Unemployment (Educated)
In urban areas, educated unemployment has become a common phenomenon.
Many youth with matriculation, graduation, and post-graduation degrees are not able to find jobs.
Sometimes, high population leads to a shortage of jobs, and sometimes, despite education, people lack the necessary skills.
A paradoxical manpower situation can exist with a surplus in some categories and a shortage in others, including unemployment among technically qualified persons alongside a lack of needed technical skills.
Consequences of Unemployment
Unemployment leads to the wastage of manpower resources.
People who could be an asset for the economy turn into a liability.
There is a feeling of hopelessness and despair among the youth.
Unemployment tends to increase economic overload as the dependence of the unemployed on the working population increases.
The quality of life of an individual as well as society is adversely affected.
It has a detrimental impact on the overall growth of an economy.
Increase in unemployment is an indicator of a depressed economy and wastes resources that could have been gainfully employed.
If people cannot be used as a resource, they naturally appear as a liability to the economy.
Unemployment prevents the economy from achieving its maximum productivity.
Statistical Unemployment Rate in India
In India, statistically, the unemployment rate is low.
A large number of people with low income and productivity are counted as employed.
They may appear to work throughout the year, but their potential and income are not adequate.
The work they pursue may seem forced upon them, and they might desire other work.
Poor people often cannot afford to be idle and engage in any activity regardless of earning potential, keeping them at a bare subsistence level.
Employment Structure in Primary Sector
The employment structure is characterized by self-employment in the primary sector.
The whole family often contributes to the field, even if not everyone is really needed, leading to disguised unemployment.
However, the concept of sharing work and produce reduces the hardship of unemployment in the rural sector, although it may not reduce poverty.
Agriculture as Labour Absorbing Sector
Agriculture is the most labour-absorbing sector of the economy.
Decline in Dependence on Agriculture
In recent years, there has been a decline in the dependence of the population on agriculture, partly due to disguised unemployment.
Movement of Labour to Secondary and Tertiary Sectors
Some of the surplus labour in agriculture has moved to either the secondary or the tertiary sector.
Small-Scale Manufacturing Labour Absorption
In the secondary sector, small-scale manufacturing was the most labour-absorbing.
Emerging Services in Tertiary Sector
In the case of the tertiary sector, various new services are now appearing, like Biotechnology and Information Technology.