People as Resource PDF

2 Chapter People as Resource Overview India’s Green Revolution is a The chapter 'People as Resource' is an dramatic example of how the input effort to explain population as an asset...

2 Chapter People as Resource Overview India’s Green Revolution is a The chapter 'People as Resource' is an dramatic example of how the input effort to explain population as an asset of greater knowledge in the form of for the economy rather than a liability. improved production technologies can Population becomes human capital when rapidly increase the productivity of there is investment made in the form of scarce land resources. India’s IT education, training and medical care. revolution is a striking instance of In fact, human capital is the stock of how the importance of human capital skill and productive knowledge embodied has come to acquire a higher position in them. than that of material, plant and 'People as Resource' is a way of machinery. referring to a country’s working people Source: Planning Commission, Govt. of India. in terms of their existing productive skills and abilities. Looking at the population from this productive aspect emphasises its ability to contribute to the creation of the Gross National Product. Like other resources population also is a resource — a 'human resource'. This is the positive side of a large population that is often overlooked when we look only at the negative side, considering only the problems of providing the population with food, education and access to health facilities. When the existing 'human resource' is further developed by becoming more educated and healthy, we call it 'human capital formation' that adds to the productive power of the country just like 'physical capital formation'. Investment in human capital (through education, training, medical care) yields a return just like investment in physical capital. This can be seen directly in the form of higher incomes earned because of higher productivity of the more educated or the better trained persons, as well as the higher productivity of healthier people. 16 Economics 2024-25  population need not be a burden for the economy. It can be turned into a productive asset by investment in human capital (for example, by spending resources on education and health for all, training of industrial and agricultural workers in the use of modern technology, useful scientific researches and so on). The two following cases illustrate how people can try to become a more productive resource: Story of Sakal There were two friends Vilas and Sakal living in the same village Semapur. Sakal was a twelve-year- old boy. His mother Sheela looked after domestic chores. His father Buta Chaudhary worked in an agricultural field. Sakal helped his mother in domestic chores. He also looked after his younger brother Jeetu and sister Picture 2.1 Seetu. His uncle Shyam had passed the matriculation examination, but, Let’s Discuss was sitting idle in the house as he had no job. Buta and Sheela were Looking at the photograph can you eager to teach Sakal. They forced him explain how a doctor, teacher, engineer to join the village school which he and a tailor are an asset to the soon joined. He started studying and economy? completed his higher secondary Not only do the more educated and the examination. His father persuaded healthier people gain through higher him to continue his studies. He raised incomes, society also gains in other a loan for Sakal to study a vocational indirect ways because the advantages of a course in computers. Sakal was more educated or a healthier population meritorious and interested in studies spreads to those also who themselves were from the beginning. With great vigour not directly educated or given health care. and enthusiasm he completed his In fact, human capital is in one way course. After some time he got a job superior to other resources like land and in a private firm. He even designed a physical capital: human resource can new kind of software. This software make use of land and capital. Land and helped him increase the sale of the capital cannot become useful on its own! For many decades in India, a large firm. His boss acknowledged his population has been considered a liability services and rewarded him with a rather than an asset. But a large promotion. People as Resource 17 2024-25  Picture 2.2 Stories of Vilas and Sakal Let’s Discuss Story of Vilas Do you notice any difference between Vilas was an eleven-year old boy the two friends? What are those? residing in the same village as Sakal. Vilas’s father Mahesh was a Activity fisherman. His father passed away Visit a nearby village or a slum area when he was only two years old. His and write down a case study of a boy mother Geeta sold fish to earn money or girl of your age facing the same to feed the family. She bought fish condition as Vilas or Sakal. from the landowner’s pond and sold it in the nearby mandi. She could In the two case studies we saw Sakal earn only Rs 150 a day by selling fish. went to school and Vilas did not go. Sakal Vilas became a patient of arthritis. was physically strong and healthy. There His mother could not afford to take was no need for him to visit the doctor him to the doctor. He could not go to frequently. Vilas was a patient of school either. He was not interested arthritis. He lacked the means to visit in studies. He helped his mother in the doctor. Sakal acquired a degree in cooking and also looked after his computer programming. Sakal found a younger brother Mohan. After some job in a private firm while Vilas time his mother fell sick and there continued with the same work as his was no one to look after her. There mother. He earned a meagre income like was no one in the family to support his mother to support a family. them. Vilas, too, was forced to sell In the case of Sakal, several years of fish in the same village. He like his education added to the quality of labour. mother earned only a meagre This enhanced his total productivity. income. Total productivity adds to the growth of the economy. This in turn pays an 18 Economics 2024-25 individual through salary or in some other Economic Activities by Men and Women form of his choice. In case of Vilas, there Like Vilas and Sakal, people have been could not be any education or health care engaged in various activities. We saw that in the early part of his life. He spends Vilas sold fish and Sakal got a job in the his life selling fish like his mother. firm. The various activities have been Henceforth, he draws the same salary of classified into three main sectors i.e., unskilled labourer as his mother. primary, secondary and tertiary. Primary Investment in human resource (via sector includes agriculture, forestry, education and medical care) can give high animal husbandry, fishing, poultry rates of return in future. This investment farming, mining and quarrying. on people is the same as investment in Manufacturing is included in the secondary sector. Trade, transport, land and capital. communication, banking, education, A child, too, with investments made health, tourism, services, insurance, etc. on her education and health, can yield are included in the tertiary sector. The a high return in future in the form of activities in this sector result in the higher earnings and greater production of goods and services. These contribution to the society. Educated activities add value to the national parents are found to invest more heavily income. These activities are called on the education of their child. This is economic activities. Economic activities because they have realised the have two parts — market activities and importance of education for themselves. non-market activities. Market activities They are also conscious of proper involve remuneration to anyone who nutrition and hygiene. They accordingly performs i.e., activity performed for pay or profit. These include production of goods look after their children’s needs for or services, including government service. education at school and good health. A Non-market activities are the production virtuous cycle is, thus, created in this for self-consumption. These can be case. In contrast, a vicious cycle may be created by disadvantaged parents, who themselves uneducated and lacking in hygiene, keep their children in a similarly disadvantaged state. Countries, like Japan, have invested in human resource. They did not have any natural resource. These countries are developed/rich. They import the natural resource needed in their country. How did they become rich/developed? They have invested on people, especially in the field of education and health. These people have made efficient use of other resources, like land and capital. Efficiency and the technology evolved by people have made these countries rich/developed. Picture 2.3 Based on the picture can you classify these activities into three sectors? People as Resource 19 2024-25 consumption and processing of primary Education helps individual to make better product and own account production of use of the economic opportunities fixed assets. available before him. Education and skill are the major determinants of the earning of any individual in the market. A majority Activity of women have meagre education and low Visit a village or colony located near skill formation. Women are paid low to your residential area and note compared to men. Most women work down the various activities where job security is not there. Various undertaken by the people of that activities relating to legal protection is village or colony. meagre. Employment in this sector is If this is not possible, ask your characterised by irregular and low neighbour what is their profession? income. In this sector there is an absence In which of the three sectors will you of basic facilities like maternity leave, categorise their work? childcare and other social security Say whether these activities are systems. However, women with high economic or non-economic activities: education and skill formation are paid at Vilas sells fish in the village market. par with the men. Among the organised Vilas cooks food for his family. sector, teaching and medicine attract Sakal works in the private firm. them the most. Some women have entered Sakal looks after his younger brother administrative and other services and sister. including job, that need high levels of scientific and technological competence. Ask your sister or your classmate what Due to historical and cultural reasons she would like to take up as a career? there is a division of labour between men and women in the family. Women Quality of Population generally look after domestic chores and men work in the fields. Sakal’s mother The quality of population depends upon Sheela cooks food, cleans utensils, washes the literacy rate, health of a person clothes, cleans the house and looks after indicated by life expectancy and skill her children. Sakal’s father Buta formation acquired by the people of the cultivates the field, sells the produce in country. The quality of the poulation the market and earns money for the family. ultimately decides the growth rate of the Sheela is not paid for the services country. Literate and healthy population delivered for upbringing of the family. are an asset. Buta earns money, which he spends on rearing his family. Women are not paid Education for their service delivered in the family. The household work done by women is Sakal’s education in the initial years of not recognised in the National Income. his life bore him the fruits in the later years in terms of a good job and salary. Geeta, mother of Vilas, earned an We saw education was an important input income by selling fish. Thus women are for the growth of Sakal. It opened new paid for their work when they enter the horizon for him, provided new aspiration labour market. Their earning like that of and developed values of life. Not only for their male counterpart is determined on Sakal, education contributes towards the the basis of education and skill. growth of society also. It enhances the 20 Economics 2024-25...human being is a positive asset and a precious national resource which needs to be cherished, nurtured and developed with tenderness and care, coupled with dynamism. Each individual’s growth presents a different range of problems and requirements.... The catalytic action Picture 2.4 School children of education in this complex and dynamic growth process needs to be national income, cultural richness and planned meticulously and executed increases the efficiency of governance. with great sensitivity. There is a provision made for providing universal access, retention and quality in Source: National Education Policy, 1986. Graph 2.1: Trends in Literacy Rates In Post-Independent India Literacy rates Year Source: Census of India, Office of Registrar General, India, (mospi.gov.in) elementary education with a special emphasis on girls. There is also an Let’s Discuss establishment of pace setting of schools Study the graph and answer the following like Navodaya Vidyalaya in each district. questions: Vocational streams have been developed 1. Has the literacy rates of the population to equip large number of high school increased since 1951? students with occupations related to 2. In which year India has the highest knowledge and skills. The plan outlay on literacy rates? education has increased from Rs 151 crore 3. Why literacy rate is high among the in the first plan to Rs 99,300 crore in males of India? 2020–21. The expenditure on education as 4. Why are women less educated than men? a percentage of GDP rose from 0.64% in 5. How would you calculate literacy rate 1951–52 to 3.1% in 2019–20 (B.E.) and in India? has remained stagnant around 3% from 6. What is your projection about India’s past few years. The Budgetary Estimate literacy rate in 2025? People as Resource 21 2024-25  Activity expansion of schools has been diluted by the poor quality of schooling and high Count the number of boys and girls dropout rates. “Sarva Siksha Abhiyan is a studying in your school or in your significant step towards providing neighbouring co-ed school. elementary education to all children in the age group of 6–14 years by 2010... It is a Ask the school administrator to time-bound initiative of the Central provide you with the data of boys and government, in partnership with the girls studying in the classroom. Study States, the local government and the the difference if any and explain for community for achieving the goal of reasons in the classroom. universalisation of elementary education.” Along with it, bridge courses and back-to- school camps have been initiated to as stated in the Budget Documents of increase the enrolment in elementary Union State Governments, Reserve Bank education. Mid-day meal scheme has been of India, the expenditure on education as implemented to encourage attendance and a percentage of GDP has declined to 2.8% retention of children and improve their in 2020–21 (B.E.) The literacy rates have nutritional status. These policies could increased from 18% in 1951 to 85% in add to the literate population of India. 2018. Literacy is not only a right, it is also The Gross Enrolment Ratio (GER) in needed if the citizens are to perform their higher education in the age group of 18 duties and enjoy their rights properly. to 23 years is 27% in 2019–20, which However, a vast difference is noticed across would be broadly in line with world different sections of the population. average. The strategy focuses on Literacy among males is nearly 16.1% increasing access, quality, adoption of higher than females and it is about 14.2% state-specific curriculum modification, higher in urban areas as compared to rural vocationalisation and networking on the areas. As per 2011 census, literacy rates use of information technology. There is varied from 94% in Kerala to 62% in Bihar. also focuse on distance education, The primary school system (I–V) has convergence of formal, non-formal, expanded to over 7,78,842 lakh in distance and IT education institutions. 2019–20. Unfortunately, this huge Table 2.1: Number of Institutions of Higher Education, Enrolment and Faculty Year Number of Number of Students Teachers in Universities Colleges Universities & Colleges 1950 – 51 750 30 2,63,000 24,000 1990 – 91 7,346 177 49,25,000 2,72,000 1998 – 99 11,089 238 74,17,000 3,42,000 2010 –11 33,023 523 186,70,050 8,16,966 2012 –13 37,204 628 223,02,938 9,25,396 2014 –15 40,760 711 265,85,437 12,61,350 2015 –16 41,435 753 284,84,741 14,38,000 2016 –17 42,338 795 294,27,158* 14,70,190* 2017–18 41,012 851 366,42,378 12,84,957 2018–19 39,931 993 37,399,388 14,16,299 2019–20 44,374 1,236 38,275,207 12,07,204 2020-21 46,007 1,074 (as on 2023) 39,434,256* 1,482,890 Source: UGC Annual Report 2019-20 and Selected Educational Statistics, Ministry of HRD. www.ugc.ac.in_Annual Report.2021–22.pdf * Provisional Data from All India Survey on Higher Education, 2017–18, 2018–19. * Enrolment estimated simple average increase during the last five year. 22 Economics 2024-25 Over the past 60 years, there has been a to maximise his/her output to the overall significant growth in the number of growth of the organisation. Indeed; health university and institutions of higher is an indispensable basis for realising one’s learning in specialised areas. Let us read well-being. Henceforth, improvement in the table to see the increase in the the health status of the population has number of college, universities, enrolment been the priority of the country. Our of students and recruitment of teachers national policy, too, aims at improving the from 1951 to 2019–20. accessibility of healthcare, family welfare and nutritional service with a special focus on the underprivileged segment of Let’s Discuss the population. Over the last five decades, Discuss this table in the classroom and India has built a vast healt infrastructure answer the following questions. and has also developed the manpower required at primary, secondary and 1. Is the increase in the number of tertiary sector in government, as well as, colleges adequate to admit the in the private sector. increasing number of students? 2. Do you think we should have more These measures, which have been number of universities? adopted, have increased the life expectancy to over 67.2 years in 2021. 3. What is the increase noticed among *Infant mortality rate (IMR) has come the teachers in the year 2015–16. down from 147 in 1951 to 28 in 2020. 4. What is your idea about future colleges **Crude birth rates have dropped to and universities? 20.0 (2020) and ***death rates to 6 (2020) within the same duration of Health time. Increase in life expectancy and Firm maximise profit: Do you think any improvement in childcare are useful firm would be induced to employ people in assessing the future progress of the who might not work efficiently as healthy country. Increase in longevity of life is workers because of ill health? an indicator of good quality of life The health of a person helps him to marked by self-confidence. Reduction realise his/her potential and the ability in infant mortality involves the to fight illness. He/She will not be able protection of children from infection, ensuring the nutrition of both the mother and the child, and childcare. Source: National Health Profile, 2021, 2022 Human Development Report, UNDP mohfw.gov.in (office of Registrar General & Census Commission, India MoHA (accessed on 29.09.2021, 6.02.2024) Let’s Discuss Study Table 2.2 and answer the following questions. 1. What is the percentage increase in dispensaries from 1951 to 2020? 2. What is the percentage increase in Picture 2.5 Children standing in queue for doctors and nursing personnel from health check-up 1951 to 2020? * Infant mortality rate is the death of a child below one year of age. ** Birth rates is the number of babies born for every 1,000 people during a particular period of time. *** Death rate is the number of people per 1,000 who die during a particular period of time. People as Resource 23 2024-25  Table 2.2: Health infrastructure over the years 2014 2015 2016 2017 2018 2019 2021 H SC/PHC/CHC 182,709 184,359 185,933 187,505 189,784 1,78,548 1,94,349 Dispensaries 29,715 29,957 30,044 31,641 31,733 31,986 36,068 and Hospitals (under Ayush (under Ayush Management) Management) Beds (Govt.) 675,779 754,724 6,34,879 710,761 713,986 818,396 849,206 Doctor Registered 41,070 43,929 48,076 48,747 56,417 63,809 – with the State Medical Council of India Nursing 2,621,981 2,639,229 2,778,248 2,878,182 2,966,375 1,201,393 3,514,373 Personnel (2020) (ANM+RN& RM+LHV) Abbreviation(s): SC: Sub centre, PHC: Primary Health Centre, CHC: Community Health Centre. ANM: Auxiliary Nurse Hydrides, RN&RM: Registered Nurses & Registered Midwives, LHV: Lady Health Visitors. Source: National Health Policy, 2016, 2017, 2018, 2020, 2022, Central Bureau of Health Intelligence, Ministry of Health and Family Welfare. 3. Do you think the increase in the How many doctors are there in the number of doctors and nurses is hospital? adequate for India? If not, why? How many nurses work in that 4. What other facilities would you like to hospital? provide in a hospital? Besides, try to gather the following 5. Discuss about the hospital you have additional information: visited? How many hospitals are there in your 6. Can you draw a graph using this table. locality? How many dispensaries are there in There are many places in India which your locality? do not have even these basic facilities. There are only 542 medical colleges in the country and 313 dental colleges. Just four Unemployment states, like Andhra Pradesh, Karnataka, Sakal’s mother Sheela looked after the Maharastra and Tamil Nadu have the domestic chores, children and helped her maximum number of medical colleges. husband Buta in the field. Sakal’s brother, Jeetu, and sister, Seetu, spend Activity their time playing and roaming. Can you Visit a nearby hospital, either call Sheela or Jeetu or Seetu government or private and note down unemployed? If not, why? the following details. Unemployment is said to exist when people who are willing to work at the going How many beds are there in the wages cannot find jobs. Sheela is not hospital you have visited? interested in working outside her 24 Economics 2024-25 domestic domain. Jeetu and Seetu are too phenomenon. Many youth with small to be counted in the work force matriculation, graduation and post population. Neither Jeetu, Seetu or Sheela graduation degrees are not able to find can be counted as unemployed. The job. A study showed that unemployment workforce population includes people from of graduate and post-graduate has 15 years to 59 years. Sakal’s brother and increased faster than among sister do not fall within this age group so matriculates. A paradoxical manpower they cannot be called unemployed. Sakal’s situation is witnessed as surplus of mother Sheela works for the family. She manpower in certain categories coexist is not willing to work outside her domestic with shortage of manpower in others. domain for payment. She too cannot be There is unemployment among called unemployed. Sakal’s grandparents technically qualified person on one hand, (although not mentioned in the story) while there is a dearth of technical skills cannot be called unemployed. required for economic growth. In case of India we have unemployment Unemployment leads to wastage of in rural and urban areas. However, the manpower resource. People who are an nature of unemployment differs in rural asset for the economy turn into a liability. and urban areas. In case of rural areas, There is a feeling of hopelessness and there is s e a s o n a l and d i s g u i s e d despair among the youth. People do not unemployment. Urban areas have mostly have enough money to support their educated unemployment. family. Inability of educated people who Seasonal unemployment happens are willing to work to find gainful when people are not able to find jobs employment implies a great social waste. during some months of the year. People Unemployment tends to increase dependant upon agriculture usually face economic overload. The dependence of the such kind of problem. There are certain unemployed on the working population busy seasons when sowing, harvesting, increases. The quality of life of an weeding and threshing is done. Certain individual as well as of society is adversely months do not provide much work to the affected. When a family has to live on a people dependant on agriculture. bare subsistence level there is a general In case of disguised unemployment decline in its health status and rising people appear to be employed. They have withdrawal from the school system. agricultural plot where they find work. Hence, unemployment has detrimental This usually happens among family impact on the overall growth of an members engaged in agricultural activity. economy. Increase in unemployment is an The work requires the service of five indicator of a depressed economy. It also people but engages eight people. Three wastes the resource, which could have people are extra. These three people also been gainfully employed. If people cannot work in the same plot as the others. The be used as a resource they naturally contribution made by the three extra appear as a liability to the economy. people does not add to the contribution In case of India, statistically, the made by the five people. If three people unemployment rate is low. A large are removed the productivity of the field number of people represented with low will not decline. The field requires the income and productivity are counted as service of five people and the three extra employed. They appear to work people are disguised unemployed. throughout the year but in terms of their In case of urban areas educated potential and income, it is not adequate unemployment has become a common for them. The work that they are pursuing People as Resource 25 2024-25 seems forced upon them. They may the secondary or the tertiary sector. In therefore want other work of their choice. the secondary sector, small scale Poor people cannot afford to sit idle. They manufacturing is the most labour- tend to engage in any activity irrespective absorbing. In case of the tertiary sector, of its earning potential. Their earning various new services are now appearing keeps them on a bare subsistence level. like biotechnology, information technology and so on. Let us read a story to know how people could become an asset for the economy of a village. Story of a Village There was a village inhabited by several families. Each family produced enough to feed its members. Each family met its needs by the members making their own clothes and teaching their own children. One of the families decided to send one of its sons to an agriculture college. The Picture 2.6 Can you remember how much did boy got his admission in the nearby you pay when you asked him to college of agriculture. After some time mend your shoes or slippers? he became qualified in agro- engineering and came back to the Moreover, the employment structure village. He proved to be so creative is characterised by self-employment in the that he could design an improved primary sector. The whole family type of plough, which increased the contributes in the field even though not yield of wheat. Thus a new job of agro- everybody is really needed. So there is engineer was created and filled in the disguised unemployment in the village. The family in the village sold agriculture sector. But the entire family the surplus in a nearby neighbouring shares what has been produced. This village. They earned good profit, concept of sharing of work in the field and which they shared among the produce raised reduces the hardship themselves. Inspired by this success of unemployment in the rural sector. But all the families after some time held this does not reduce the poverty of the a meeting in the village. They all family, gradually surplus labour from wanted to have a better future for every household tends to migrate from the their children too. They requested the village in search of jobs. panchayat to open a school in the Let us discuss about the employment village. They assured the panchayat scenario in the three sectors mentioned that they would all send their earlier. Agriculture, is the most labour children to school. The panchayat, absorbing sector of the economy. In recent with the help of government, opened years, there has been a decline in the a school. A teacher was recruited dependence of population on agriculture from a nearby town. All the children partly because of disguised unemployment of this village started going to school. discussed earlier. Some of the surplus After sometime one of the families labour in agriculture has moved to either gave training to his daughter in 26 Economics 2024-25 tailoring. She started stitching consume. Now they could sell what clothes for all the families of the they produced to others who came to village for everyone now wanted to their village markets. Over time, this buy and wear well-tailored clothes. village, which formally had no job Thus another new job, that of a tailor opportunities in the beginning, had was created. This had another many like teacher, tailor, agro– positive effect. The time of the engineer and many more. This was farmers in going far for buying clothes the story of a simple village where was saved. As the farmers spent the rising level of human capital more time in the field, the yield of enabled it to evolve into a place rich the farms went up. This was the with complex and modern economic beginning of prosperity. The farmers activities. had more than what they could Summary You have seen how inputs like education and health helped in making people an asset for the economy. The chapter also discusses about the economic activities undertaken in the three sectors of the economy. We also study about the problem associated with unemployment. Finally the chapter ends with the story of a village which formally had no job but later had plenty. Exercises 1. What do you understand by 'people as a resource'? 2. How is human resource different from other resources like land and physical capital? 3. What is the role of education in human capital formation? 4. What is the role of health in human capital formation? 5. What part does health play in the individual’s working life? 6. What are the various activities undertaken in the primary sector, secondary sector and tertiary sector? 7. What is the difference between economic activities and non-economic activities? 8. Why are women employed in low paid work? 9. How will you explain the term unemployment? 10. What is the difference between disguised unemployment and seasonal unemployment? 11. Why is educated unemployed, a peculiar problem of India? 12. In which field do you think India can build the maximum employment opportunity? 13. Can you suggest some measures in the education system to mitigate the problem of the educated unemployed? 14. Can you imagine some village which initially had no job opportunities but later came up with many? 15. Which capital would you consider the best — land, labour, physical capital and human capital? Why? People as Resource 27 2024-25  References GARY, S. BECKER. 1966. Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education, General Series. Number 80. New York. National Bureau of Economic Research. THEODORE, W. SCHULTZ. 'Investment in Human Capital'. American Economic Review. March 1961. Economic Survey 2015–2016. Ministry of Finance, Government of India, New Delhi. India Vision 2020. The Report. Planning Commission. Government of India, New Delhi. Mid-Term Appraisal of the Tenth Five Year Plan (2002–2007). Planning Commission, Part II. New Delhi. Tenth Five Year Plan ( 2002–2007). Planning Commission, New Delhi. Twelth Five Year Plan ( 2012–2017). Planning Commission, New Delhi. NCERT. 2016. Trilingual Dictionary of Economics, p. 62. 28 Economics 2024-25