Organising the unorganised

Organising the unorganised: Union membership and earning in India’s informal economy

BSG-WP-2016/015

This BSG working paper explores the organization of labour within the informal economy in India. The share of the informal workforce in India has increased over the past couple of decades and now represents over three quarters of the nation’s labour force. Globally it is assumed that this trend has been can lead to the demise of organised labour, but evidence from India indicates that large and growing numbers of informal workers belong to officially recognised trade unions.

In this paper, author Shahana Chattaraj reviews the literature on labour organisation in the informal economy and analyses large national employment survey data. Chattaraj finds that union membership is associated with a significant increase in earnings, controlling for social group, education and occupational characteristics. This relationship, however, does not hold for women, who are disproportionately concentrated in the lower-rungs of the informal workforce as home-workers and domestic workers.

The policy implication of the paper is that given the magnitude of the informal workforce in India, the government’s effort to improve living standards must address working conditions and prospects for informal workers. Chattaraj argues that labour organisation within the informal economy will play a critical role in this regard, by pushing the state to intervene in support of workers, enact and enforce legislation and implement welfare programmes for informal workers.

About the author:

Shahana Chattaraj, Post Doctoral Researcher at the Blavatnik School of Government, University of Oxford.