India’s unincorporated sector added 8 million more establishments, 10 million more workers in 2023-24

More jobs in unincorporated sector in 2023-24

Unincorporated enterprises grew at a faster clip than the country in 2023-24 (October-September), according to the results of the annual survey released by the government on December 24.

India’s unorganised enterprises, which also capture the activity of the informal economy, recorded a 16.5 percent growth compared with the previous year compared with 15.1 percent in the previous year, as the economy picked up the pace to 7.1 percent in the October-September period compared with 6.7 percent during the similar period during the last fiscal.

“This data shows the lagged effect of growth spurt. Various policy initiatives were supportive of entrepreneurship. Govt initiatives on start-up and stand-up India during Covid has allowed enterprises to grow,” chief economic advisor V Anantha Nageswaran said, addressing the media at the release of the Annual Survey of Unincorporated Sector Enterprises (ASUSE) by Ministry of Statistics and Programme Implementation (MoSPI).

ASUSE data shows a 12.8 percent increase in establishments and a 10 percent increase in employment during this period.

MoSPI secretary Saurabh Garg also noted an increase in labour productivity as well, as gross value added per worker registered a 5.6 percent increase to Rs 1.5 lakh from Rs 1.42 lakh in 2022-23.

“There are now 7.4 crore establishments, and over 12 crore people are employed. Productivity of enterprises is also increasing,” Garg said.

Wages in the unincorporated sector sector grew 13 percent, with manufacturing wages rising 16 percent.

The survey tracks the performance of the economy across manufacturing, trade and other services.

The other services sector grew faster at 26.2 percent, while trade expanded by 12.8 percent and manufacturing grew at 5.4 percent.

However, the GVA per establishment of other services and manufacturing in urban areas contracted in 2023-24.

“If you have growth in new establishments, then they would take longer to achieve full capacity utilisation and value generation, which explains slight decline in manufacturing and other services in urban areas," CEA said.

The 2023-24 version of the survey also comes with a new methodology as it incorporates tuition teachers, housemaids, gardeners and cooks.

The data also indicates a push for digital among unincorporated sector enterprises.

“The digital economy is increasing, and the expansion of digital public infra is showing. Nearly 27% of businesses use the internet, female-owned establishments have also increased,” Garg highlighted.

The number of establishments using internet went up from 21 percent in 2022-23 to 26.7 percent in 2023-24, while female-led establishments rose to 26.2 percent from 22.9 percent in 2022-23.