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8. Making a Living in Calcutta
Employment in the Informal Sector
p. 209-221
Texte intégral
1Two aspects of the Calcutta metropolitan economy, though apparently not quite consistent, with each other, nevertheless appear to be equally relevant in its analysis1. On the one hand Calcutta, like any large metropolis, houses a significant section of India's modem non-agricultural economic activities —manufacturing, commerce, administration and trade. On the other, it accommodates vast numbers of appallingly poor people who make a living there by methods unthinkable in the framework of a modem city. Official records usually tend to concentrate more on the former aspect. It is also this aspect that provides the basis of the regional plans for the area. To the social analysts and portrayers, however, the latter characteristic is more appealing. At one time, vivid accounts of the state of the poor in Calcutta with appropriate pictures to illustrate them, had a good market in the world of international journalism1. Lately, fashions and ideas have changed somewhat. Earlier studies of the urban situation everywhere were based on the assumption that the historical model which fitted the path of urbanization in the now developed centres, could also be used to explain such developments in the developing countries. As such, the poverty or other non-standard forms of activities that exist in cities such as Calcutta were regarded mainly as an aberration —a deviation from the pattern —presumably caused by their colonial heritage. Now, probably because it has become clear that this poverty is very much a part of the pattern and cannot easily be removed, efforts are being made to better understand the workings of this "non-modem" section of the economy. There are now numerous studies about this informal or unorganized sector for various cities of the Third World including a few on Calcutta2.
2In spite of these recent studies of the unorganized sector in numerous cities of the developing countries, the concept still remains a descriptive one. Hence attempts at drawing any general conclusions about the essential character of the sector have fared rather like those of the blind men describing an elephant3. In each urban centre, the informal sector seems to be composed of differing combinations of activities, and plays a role in the city's economy which is peculiar to that city alone. Nevertheless, the formulation of the concept has one great achievement to its credit: it has removed the horror that people used to feel when contemplating poverty like that in Calcutta. On observation it appears that amongst the poor, there is little of "bashing of breasts and gnashing of teeth." Rather, the poor quietly go about their business of making a living. This has made it easier for the observers to accept the inevitability of such poverty and be content with suggesting some marginal improvements.
3Whatever the composition of the unorganized sector in Calcutta, the size of employment there is fairly impressive as can be seen from Table 8.1.
Table 8.1: The employment situation of the population in age group 15 to 59 in the Calcutta Metropolitan District in 1977
In thousands | Male | Female | Total |
Total population (1) | 3201 | 2752 | 5953 |
Labour force (2) | 2791 | 418 | 3209 |
Unemployed (2) | 278 | 60 | 338 |
Employed (2) | 2513 | 358 | 2871 |
(a) Organized sector (3) | 1522 | 138 | 1650 |
(b) Unorganized sector (3) | 991 | 220 | 1211 |
4As the Table 8.1 shows, the unorganized sector already accommodates over 40 per cent of the labour force in the metropolis. This is not just true of Calcutta but also of Bombay according to a fairly recent estimate4. However, the growth of employment in the organized sector has been particularly slow in West Bengal during the years 1961-1977 even compared with its sluggish all-India rate (Table 8.2).
5Therefore, the gap between the number of people in the labour force and of those employed in the organized sector may be expected to grow at a faster rate for west Bengal even if one allows for the slower rate of increase in urban population in this State. Moreover, as we shall see below, a family wholly dependent on the unorganized sector has to send out more workers to ensure for itself a minimal living. Often such additional workers are either children below the age of fifteen or old people beyond the age of sixty. Table 8.2 has ignored these workers completely. Children or old people, when they work, do not work in the organized sector so that including their numbers in the labour force would increase the relative share of the unorganized sector in the total employed still further2. According to the National Sample Survey estimates there is a difference in the number of those regularly employed and those employed occasionally or casually5. Presumably those in the organized sector are regularly employed. Therefore amongst those in the unorganized sector some of the employed may be working irregularly. Nevertheless, the fact remains that this amalgam of regular and irregular activities is employing in that sector over 1.2 million men and women of Calcutta. What adjustments are being made in the unorganized sector to make it possible for such large and increasing numbers to find employment there?
A cut in wage rates
6The most important, and economically also the most obvious of the adjustments is, of course, in the wage rates. For similar skills and occupations, the wages in the unorganized sector would be significantly lower. It is not always possible to make this comparison between the two sectors since the technology and processes used in the two often differ widely even when the product is identical. But one can find occasional examples where the technology is almost identical. One such is provided by the bidi industry3. In West Bengal, the officially fixed minimum wage rate for bidi rolling in workshops is now Rs. 3.50 to Rs. 4.25 per 1000 bidis when the worker is given both the tobacco and the leaves to roll it in. However in a recent survey6, it was found that women who took the same work home got only Rs. 1.50 to Rs. 2.50 per 1000 bidis. Similarly, the technique of assembling radios is the same whether done in factory premises or when farmed out to small workshops. But the average wage rate in the latter is about one-fourth that of the former. In addition, the small units save considerably on overheads.
7A much better known and accepted fact is that the average incomes of workers in the two sectors differ widely. For example, in 1972 the average monthly income in the organized industry for unskilled workers in West Bengal was Rs. 2877. In his study on the small sector, A.N. Bose shows that neither for the hired worker nor for the self-employed worker (i.e., for a worker who had invested some capital in tools) in the unorganized sector did the income hardly ever reach a level of Rs. 100-110 per month8.
8Whether or not the income differences between the two sectors are justified by differences in their productivities is not always clear. One can only say that in both the sectors, formal or informal, wage determination is far removed from the model of perfect competition. In the formal sector, workers bargain through industry-wise unions with the closely knit group comprising most employers in that industry and both sides use their political influences in the bargain. In the informal sector, the worker is completely isolated and desperate while employers often have a good understanding between themselves about wage rates9. The bargain is too unequal to be anything but exploitative in a labour surplus situation. Adjusting wage rates downwards would logically create some further demand for labour; but it also means that a family has to send out more workers to ensure for itself a minimal income. In the survey mentioned earlier, we found that amongst the families where all members worked in the unorganized sector, only those which sent out at least three earners could ensure a per capita level of income above the official poverty level4. The rest of the families were obviously in deep distress. Therefore this cut in wage rate probably increases not just the demand but also the supply of labour in the sector. The resultant equilibrium can only be a very unstable one.
Expanding the choice horizon
9The unorganized sector can create more jobs because it significantly adds to the choices offered by the organized sector to consumers as well as to the employers. The Indian organized sector still produces a very narrow range of goods which cater to the standardized demands of only a limited section of the population, largely the middle section. Even the supply of mill-made cheap cloth has been lagging far behind the growth of population. The only cheap readymade food available on a large and standardized scale is bread. There is no organized System of providing ready-made cheap meals for the working classes. Nor does the organized sector build residential housing, make furniture or even provide basic health services, such as dental or eye care at prices which those below the middle class can afford. On the other hand, it also does not cater to the highly personalized demands of the rich both for made-toorder goods such as shoes or clothing or for personal services such as child care, repairs of expensive equipment and so on. These fairly widespread and regular needs are neglected by the organized sector because their Standardization is not easy and in any case the margin of profits on them is not satisfactory with the overheads required for the organized sector.
10Activities in the unorganized sector are not confined just to satisfying genuine regular wants. A large section of people in the sector live literally by creating and catering to further low priority transitional demands. These workers offer fancy goods and odd services each of which is worth purchasing by the customer only at a very low price —a price which reflects a very low rate of wage. Amongst these, at the one end are socially useful activities like the recycling of garbage —collection for refuse of items, such as pieces of old cloth and paper, half-burnt pieces of coal etc...Although the social benefits of such activities may be high, market valuation is still extremely low and it is only the lack of alternative work that makes it worth the while of a person to walk the streets for hours in search of such items. At the other end there would be persons making some entirely trivial items like glass trinkets from used beer bottles, homemade ink, odd medicine recipes, cheap toys, strings of beads etc., which can only serve a very passing fancy. In most such cases, the producer knows that there is little chance of a repeat order but is content to persuade the customers to buy the items just once by keeping the price low. Often it is more the salesmanship than the intrinsic usefulness of the item that clinches the sale.
11Not only is the informal sector a method of expanding the choice horizon of the Consumers, but it also allows for various adjustments in the quantity and quality of labour that can be bought by the employers. In the formal sector labour is usually hired for a fairly long period. The only adjustment permissible is for some workers to work overtime at somewhat higher wage rates. In the informal sector, on the other hand, labour can and is hired and fired casually, on a daily, hourly, or a piece rate basis. Often female and child labour is preferred for their relatively lower cost. Amongst domestic servants for example, workers are hired just for a particular job and often child labour is given preference in case the payment includes board and lodging. Even if a worker continues in the same job there is no obligation on the employer's part towards him. Availability of such infinitely divisible and variable labour supply makes it possible to try new techniques of production and marketing. By changing the quality of the labour and therefore of the product, costs can be cut to suit a further section of the consumers. Often the actual quality of the labour or of the product may not alter: but because a more vulnerable group of workers, such as children or women are used, the cost can be cut further. With workers willing to work in poor conditions for long hours at low wages, transport by rickshaws, handcarts or head loads can replace motorized vehicles to a certain extent. Shoes made by old fashioned craftsmen working manually can compete with machine-made standardized ones and so on.
Doing without
12Over and above all such adjustments, the poor fill the gap between their needs and resources by doing without a lot of even basic necessities. They make do with very little residential space. The standard practice in Calcutta bastees is for children to sleep under their parents' cot which is raised by putting bricks below the legs. They make do without equipment. In the sample drawn for a survey of women workers6, one found women tailors working with one 25 watt electric bulb to the room. All workers in the unorganized sector do without any kind of insurance against old age, sickness, maternity or industrial hazards.
13The most serious sacrifice that the poor accept is for their children. For a large number, there is really no childhood in the sense of a period when a person is given a guarantee of a living by his family and society in order that he may acquire a certain level of education, skill and knowledge. If the family income is low, children have to start work often as early as at the age of eight or ten. In the Calcutta survey referred to above we found that about 30 per cent of the children below the age of fifteen of the interviewees worked regularly. Of the children over the age of 10, over fifty per cent had never attended the primary school.
14A large section of the workers do without the comforts of family life —male workers leave their families in the village. What is more unusual, we found a significant number of married women with children, leaving their entire family in the village in the care of an older child to come lo city to work as a commuter or as a temporary resident.
What next?
15Viewed at one point of time, the unorganized sector seems to have added lo the net welfare of the society. It has utilized some idle or underutilized resources, mainly labour, to add to the range and quantity of goods, services, techniques and processes available to the society. In the process, the poor make a living. However meagre the living, several scholars find solace in such facts as that "these informal sector units as a whole in West Bengal could maintain 9,48,000 workers and their dependents.... at least near the poverty level"10. The question is, however much the informal sector may be welcome as a temporary solution to the immediate Problems of unemployment and poverty, does it hold out any hope of development for a better living for the people working there?
16The answer to this question in the last resort must be in the negative. The current euphoria about the unorganized sector springs from the fact that, for the moment, it appears to have provided a living to a large section of the population which had proved redundant to activities in the organized sector. If there is misery and exploitation contingent to the solution, the experts draw relief from the fact that even Great Britain went through a similar stage of development. Today’s Calcutta is probably no worse than Dickens' London. Such parallels can be drawn however, only because the present data about the sector all refer to one point of time. The concept of an unorganized sector is recent and few scholars have adequate data for tracing its dynamics or its path of development in cities like Calcutta. Nevertheless the little information one has about the happenings in the last two decades and about the character of the variables is sufficient to bring out the essentially different character of the current process from the experience of the countries developing earlier.
17The greatest advantage of the unorganized sector appears to lie in its flexibility, i.e., in the fact that it can accommodate innumerable variations on the standard production and distribution methods in the economy: but it is worth remembering that the burden of all such adjustments that make the unorganized sector viable are borne entirely by the workers there and their families. As employees, they bear wage cuts, put out more labour to make up a minimum income and also learn the few basic skills and adaptations required from their families and peers. As self-employed workers, they try to devise goods and services out of their limited knowledge and acquire tools and materials from their meagre resources. If they sell directly in the market, the risk is of course theirs. But even if their production is on order from a middleman or a larger industrial unit, the small units usually have to bear the risks of a high rejection rate or delays in payments of bills.
18The flexibility of this economic order then, is based entirely on the fact that the poor are allowing the others to squeeze all possible surplus out of their activities by way of wage cuts, lower remunerations for management, design and risk taking as well as through a lower quality of life. In principle such squeezing does not have to stop even at a minimal level of survival. A part of the labour can literally die off in the process without necessarily creating a shortage in the quantity of labour supplied: but the labour that survives the squeeze no longer remains the sort which can work efficiently or learn new skills. Moreover, it cannot play any role in the development process except as cogs in the wheel.
19Just to illustrate: earlier, Calcutta had a fine tradition of many sophisticated and delicate skills. The best hand-made shoes would be got here. Almost any machine could be given an infinite life because spare parts, however sophisticated, could be reproduced. The quality of delicacies in food —be it Bengali, European, Mughlai or Chinese— that could be had in Calcutta was unbelievable. The craftsmanship in gold, embroidery or tailoring was of a very high quality. Now, because no craft can ensure an adequate living in the city, the craftsmen are either moving out or not being replaced. Calcutta's Chinese who were expert carpenters, shoe-makers and cooks have moved away. Experts in European cooking are long gone and Calcutta is fast losing its reputation for light engineering to other parts of the country. Now Calcutta only produces either the standardized brand names or tacky goods whose main qualification is that they are cheap.
20Apart from the fall in health standards that poverty brings about, a large percentage of the children of the workers in this sector are unable even to finish primary level education. This is borne out very well by the data of the Education Department, West Bengal, which show that not even a quarter of the children ever reach the secondary education stage. This means that the entire blue collar labour in the metropolis will continue to be illiterate or near-illiterate for another generation. Moreover, in the unorganized sector, there is no recognized channel for learning skills for new workers except through their families or neighbours. In the Calcutta survey we found that of the skilled workers less than 30 per cent had any formal training. The rest along with the semi-skilled had learned the work either from families and friends or on the job.
21Inevitably, this kind of skill training is mainly by rote. In other words, even skilled artisans like masons or carpenters know their job by imitation. Without some basic education in subjects like geometry, mensuration, or mechanics, they have no way of adapting their knowledge in a changing market. This is precisely why the small engineering units of Calcutta are non-viable in the long run. An experienced worker can be very skilled at a particular task or at the use of a tool like a lathe, but he has no proper conception of the total potential of the tool or of the skill because he knows nothing of the basic principles behind it. Therefore, with all his ingenuity and desperation, he is usually totally dependent on others for designing work and a change in the pattern of Orders can make him totally redundant. In the early part of the industrial revolution of England, master craftsmen and artisans played a vital role in devising improved machines and processes and in the process made fortunes for themselves; but these craftsmen were fully conversant with the disciplines relevant to their work. David Landes11 writes of the English artisans: "Even more striking is the theoretical knowledge of these men. They were not, on the whole, the unlettered tinkerers of historical mythology. Even the ordinary millwright, as Fairbairn notes, was usually "a fair arithmetician, knew something of geometry, levelling, and mensuration, and in some cases possessed a very competent knowledge of practical mathematics. He could calculate the velocities of strength, and power of machines: could draw in plan and section...." Much of these "superior attainments and intellectual power" reflected the abundant facilities for technical education in "villages" like Manchester during this period, ranging from dissenters’ academies and learned societies to local and visiting lecturers, "mathematical and commercial" private schools with evening classes, and a wide circulation of practical manuals, periodicals, and encyclopaedias." Where do Calcutta's engineering workers stand in comparison with these?
22The craftsman of England of the 18th Century had another advantage which is denied to our artisans. He had many trade magazines and journals to inform him of the changes in technology as well as markets12. The artisan of Calcutta has no such source because no such literature is published in a language that he can understand at a cost he can afford. Therefore, though living in one of the world's major cities, he gets no advantage from the growing stock of academic expertise or practical experiments elsewhere. The few government efforts at providing such knowledge or information are so far removed that they rarely reach the artisan. Given that the industrial technology today is much more sophisticated than during the British industrial revolution, Calcutta's artisans have little chance of keeping up with it, from their isolated position.
23The basic difference in the two situations however lies elsewhere. England's artisans and self-employed craftsmen were working in a country which was already generating and accumulating substantial capital in all activities. Hobsbawm gives the example of the Peel family which transformed within the 18th Century its savings from a middling farm and domestic weaving industry to own a large cotton textile industry and produce a prime minister by the end of the Century13. Few men of ideas and experience were derived scope to exploit them. As against this the artisan of Calcutta today has absolute no access to investible capital. He has no family resources; his wages as a worker or profits as a self-employed person can allow no accumulation. And the many government schemes to provide the small man with capital from commercial or financial institution have fared altogether miserably. The Draft Sixth Plan has ruefully admitted this total failure14.
24This inability to accumulate either physical capital or what is now fashionably called human capital, makes these craftsmen and artisans especially vulnerable. They are forced into stagnation: and yet unless they have the wherewithal to change with the times, the process of development ruthlessly weeds them out.
25That this unorganized sector provides no future for the workers and their activities is shown again and again by case studies. To quote one: there is a village just out the C.M.D. where 90 per cent of the population is engaged for over two generations in making brushes for shoes and clothes from animal hair backed by wood. In spite of the skill which is admittedly high and the experience of such a long period, the villagers are still completely in the grip of the middlemen who control the supply and price of animal hair. Also, none in the village has diversified any further into other kinds of brushes or products so that any technological advance such as synthetic hair brushes could ruin the whole village. Or a large scale unit which can cut out the middlemen and get the animal hair cheaper will be able to undercut them even at their present very low wage rates. The village is completely helpless against any such contingency and the industry has no lasting future in a changing world.
26One can quote many such cases, for example, the sports goods makers of Howrah or the cake makers of Calcutta. The point romains: the worker survives from day to day. His future is as uncertain as that of the stone-age man.
Conclusion
27To the individual worker, his employment in the unorganized sector is an immediate blessing, however dubious its value may be in the long run. Therefore, in the absence of any alternative prospects of a living, he cannot be expected to protest against its anomalies and exploitation. To the social scientist observing from the outside, however, the self-destructive character of this process in the long run should be fairly obvious. And he owes it to himself and to the poor working in the metropolis not to connive at the phenomenon with suggestions of marginal improvement but start working on plans for a structural change in the city's economy.
Notes de bas de page
1 Moorhouse, G., Calcutta 1971, London, Wiellenfeld and Nicholson, 1972.
2 Lubell, H., Calcutta: Its Urban Development and Employment Process, Geneva I.L.O., 1974.
Dasgupta, B. "Calcutta's Informal Sector", I.D.S. Bulletin, 1973.
Bose, A.N. Calcutta and Rural Bengal: Small Sector Symbiosis, Calcutta, Minerva, 1978.
3 Majumdar, D., "Analysis of the Dual Labour Market in LDCs", 4th Congress of the International Industrial Relations Association, 1976.
Gerry, C., Petty Producers and the Urban Economy: A Case Study of Dakar, Geneva, I.L.O., 1974, World Employment Research Working Paper. Berry, A. "Wage Employment, Dualism and Labour Utilization in Colombia", Journal of Developing Areas, (U.K.), July 1975.
4 Joshi,V. and H., Surplus Labour and the City, Table n°. III. 2, pp. 54-55, Oxford University Press, 1975.
5 National Sample Survey, Survey of Employment and Unemployment 32nd Round 1977-78, New Delhi Department of Statistics, Government of India.
6 Banerjee, N. (ed.)., A Survey of Women Workers in the Unorganized Sector of Calcutta 1976-77, Calcutta,. Centre for Studies in Social Sciences.
7 Indian Labour Statistics 1975, Table No. 4.1, New Delhi, Ministry of Labour.
8 Bose, A.N., op. cit., Chapter 4, Also see reference Table G.
9 Basu, T., "Calcutta Sandal Makers", Economic and Political Weekly, (Bombay), 6 August 1977.
10 Bose, A.N. op. cit., p. 23.
11 Landes, D.S., The Unbound Prometheus: Technological Change and Industrial Development in Western Europe from 1750 to the Present, Cambridge & New York 1969, p. 63.
12 Braverman, H., Labour and Monopoly Capital, New York, Monthly Review Press, 1974, p. 133.
13 Hobsbawm, E.J., Industry and Empire, in: The Pelican Economic History of Britain, Vol. III, Penguin Book, p. 62.
14 Planning Commission, The Draft Sixth Plan For India, New Delhi, 1978, p. 176.
Notes de fin
1 This paper, as presented in the Seminar, was published under its original title "Survival of the Poor" in the volume Towards a Political Economy of Urbanization in the Third World Countries, edited by Helen Safa, Oxford University Press, New Delhi, 1982 (pp. 175-187). The present text has been revised by the author (J.R).
2 According to a study conducted by Swapan Kumar Sinha, from Calcutta University, in 1971 in Calcutta city alone, some 20,500 children were working, 20 per cent 18 hours a day, for a salary of Rs. 5 to 50 a month plus food; 40 per cent were from the neighbouring rural districts, and 27 per cent from Bihar. The Telegraph, March 6, 1983.
3 Bidis are those popular substitutes for cigarettes, consisting of a cheap variety of tobacco rolled in the leaves of the "tendu" tree (Diospyros melanoxylon Roxb. or Coromandel Ebony Persimmon).
4 The official poverty line has been defined in our footnote d, Chapter 3.
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Calcutta 1981
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