CHAPTER

1.1 India is a land of villages as around two-third of the total labour force in the country lives in rural areas. Wage paid employment is the main source of their livelihood. It has been the endeavour of the Government of India to alleviate poverty, particularly in the rural areas, by formulating and implementing various target oriented anti-poverty rural development programmes. For formulating appropriate policies and programmes, sound data base is of utmost importance. Government of India had recognised the need for sound data base during early years of independence itself and conducted first Agricultural Labour Enquiry (ALE) in 1950-51, followed by the second Enquiry in 1956-57. Thereafter, the scope of the subsequent enquiries was enlarged to cover all rural labour households, instead of agricultural labour households alone covered in the first two enquiries. Hence, the third enquiry in the series known as the ‘first Rural Labour Enquiry (RLE)’ was conducted in 1963-65 followed by the second in 1974-75, the third in 1977-78, the fourth in 1983, the fifth in 1987-88, the sixth in 1993-94, the seventh in 1999-2000 and the eighth in 2004–05. With a view to narrowing down the gap between the successive rounds of the Enquiries, the RLE was integrated with the General Employment & Unemployment Survey of the NSSO in 1977-78 and all subsequent enquiries are now being conducted quinquennially to provide continuous data in the form of time series.

1.2 During the course of the Rural Labour Enquiries, data on various socio-economic aspects viz, Employment & Unemployment; Consumption Expenditure; Wages & Earnings; and Indebtedness of rural and agricultural labourers are collected by Field Operation Division (FOD) of National Sample Survey Organisation(NSSO) through its network of Zonal, regional and sub-regional offices located all over the Country. Under these enquiries, the data are collected and analysed for rural labour as a whole. However, in order to enable comparison with the previous rounds of enquiries and also to understand problems of this segment, which constitutes bulk of the rural labour, the analysis are presented for agricultural labour separately. The Labour Bureau is responsible for processing and disseminating data, collected under RLE, on General Characteristics, Indebtedness, Wages and Earnings, Consumer Expenditure and Employment& Unemployment of the Rural Labour Households. The results of the latest Rural Labour Enquiry, the eighth in the series, for which the field work was undertaken by the (FOD) NSSO during its 61^st Round Survey (July, 2004 to June, 2005), are being published in the following five reports:

1.3 The usefulness of the data thrown up by the Rural Labour Enquiries has been acknowledged by various Committees and Commissions from time to time. The National Commission on Labour (1969) and the National Commission on Rural Labour (1991) have recommended that the periodic surveys undertaken by the Government to understand the rural situation should be continued and intensified. The second National Commission on Labour (1999) has recommended that the Rural Labour Enquiries should be conducted more frequently.

i) To provide upto-date serial data on demographic structure, extent of employment & unemployment, wages and earnings, household consumption expenditure, indebtedness, etc. for building up of reliable estimates of important socio-economic characteristics of rural labour in general and agricultural labour in particular.

ii) To provide data relating to consumption expenditure for derivation of weighting diagram for updating the series of CPI numbers for agricultural and rural labourers.

3. SCOPE:

The Enquiry relates to all rural labour households. However, provision has been made in the tabulation plan to get separate estimates for agricultural labour households.

4. GEOGRAPHICAL COVERAGE

The survey covered the whole of the Indian Union, excepting (i) Leh (Ladakh) and Kargil districts of Jammu & Kashmir, (ii) interior villages of Nagaland situated beyond 5 Kms. of the bus route, and (iii) villages in Andaman & Nicobar Islands which are inaccessible throughout the year.

5.1 Outline of sample design: A stratified multi-stage design has been adopted for the 61^stround survey. The first stage units (FSU) are the 2001 census villages in the rural sector and Urban Frame Survey (UFS) blocks in the urban sector. The ultimate stage units (USU) are households in both the sectors. In the case of large villages/blocks requiring hamlet-group (hg)/sub-block (sb) formation, one intermediate stage is the selection of two hgs/sbs from each FSU.

5.2 Sampling Frame for First Stage Units: For the rural sector, the list of 2001 census villages (panchayat wards for Kerala) constitutes the sampling frame. For the urban sector, the list of latest available Urban Frame Survey (UFS) blocks has been considered as the sampling frame.

5.3 Stratification: Within each district of a State/UT, two basic strata have been formed: i) rural stratum comprising of all rural areas of the district and (ii) urban stratum comprising of all the urban areas of the district. However, if there are one or more towns with population 10 lakhs or more as per population census 2001 in a district, each of them will also form a separate basic stratum and the remaining urban areas of the district will be considered as another basic stratum. There are 27 towns with population 10 lakhs or more at all-India level as per census 2001.

5.4.1 Rural sector: If ‘r’ be the sample size allocated for a rural stratum, the number of sub-strata formed is ‘r/2’. The villages within a district as per frame have been first arranged in ascending order of population. Then sub-strata 1 to ‘r/2’ have been demarcated in such a way that each sub-stratum comprises a group of villages of the arranged frame and has more or less equal population.

5.5 Total sample size (FSUs): 12784 FSUs have been allocated at all-India level on the basis of investigator strength in different States/UTs for central sample and 14992 for state sample.

5.6 Allocation of total sample to States and UTs: The total number of sample FSUs is allocated to the States and UTs in proportion to population as per census 2001 subject to the availability of investigators ensuring more or less uniform work-load.

5.7 Allocation of State/UT level sample to rural and urban sectors: State/UT level sample size is allocated between two sectors in proportion to population as per census 2001 with 1.5 weightage to urban sector subject to the restriction that urban sample size for bigger states like Maharashtra, Tamil Nadu etc. should not exceed the rural sample size. A minimum of 8 FSUs has been allocated to each state/UT separately for rural and urban areas.

5.8 Allocation to strata: Within each sector of a State/UT, the respective sample size is allocated to the different strata in proportion to the stratum population as per census 2001. Allocations at stratum level have been adjusted to a multiple of 4 with a minimum sample size of 4.

5.9 Selection of FSUs: Two FSUs have been selected from each sub-stratum of a district of rural sector with Probability Proportional to Size With Replacement (PPSWR), size being the population as per Population Census 2001. For urban sector, two FSUs have been selected from each sub-stratum by using Simple Random Sampling Without Replacement (SRSWOR). Within each sub-stratum, samples have been drawn in the form of two independent sub-samples in both the rural and urban sectors.

5.10.1 Criterion for hamlet-group/sub-block formation: Large villages/blocks having approximate present population of 1200 or more will be divided into a suitable number (say, D) of ‘hamlet-groups’ in the rural sector and ‘sub-blocks’ in the urban sector as stated below.

approximate present population of the sample village/block	no. of hgs/sbs to be formed (D)

less than 1200 (no hamlet-groups/sub-blocks)	1
1200 to 1799	3
1800 to 2399	4
2400 to 2999	5
3000 to 3599	6
…………..and so on

For rural areas of Himachal Pradesh, Sikkim and Poonch, Rajouri, Udhampur, Doda districts of Jammu and Kashmir and Idukki district of Kerala, the number of hamlet-groups formed is as follows.

Two hamlet-groups/sub-blocks are selected from a large village/UFS block wherever hamlet-groups/sub-blocks have been formed, by SRSWOR. Listing and selection of the households are done independently in the two selected hamlet-groups/sub-blocks. In case hamlet-groups/sub-blocks are to be formed in the sample FSU, the same would be done by more or less equalizing population.

For both Schedule 1.0 and Schedule 10, households listed in the selected village/block/ hamlet-groups/sub-blocks are stratified into three second stage strata (SSS) as given below.

6.1 The three second-stage-strata (SSS) in the rural sector are formed in the following order:

SSS 1:

relatively affluent households

SSS 2:

from the remaining households, households having principal earning from non- agricultural activity

SSS 3:

other households

The number of households to be surveyed in each FSU is 10 for each of the schedules 1.0 and 10. Composition of SSS with number of households to be surveyed for both schedule 1.0 and schedule 10 are as follows:

SSS	composition of SSS	no. of hhs to be surveyed

SSS 1:	relatively affluent households	2	1
SSS 2:	of the rest, households having principal earning from non- agricultural activity	4	2
SSS 3:	other households	4	2

7. Selection of households for Schedules 1.0 and 10: From each SSS the sample households for both the schedules are selected by SRSWOR. If a household is selected both for schedule 1.0 and schedule 10, only schedule 1.0 would be canvassed in that household and the sample household for schedule 10 would be replaced by next household in the frame for schedule 10.

A total of 3,98,025 persons spread over 7,999 villages were surveyed. The number of sample villages and persons surveyed in different States/Union Territories and all-India for rural sector are set out in the following statement:

NUMBER OF VILLAGES, BLOCKS ALLOTTED/SURVEYED AND RURAL HOUSEHOLDS PERSONS SURVEYED IN DIFFERENT STATES/UTs

The enquiry was integrated with the 61^st round of the N.S.S. during the period 1^st July, 2004 to 30^th June, 2005 which was divided into 4 sub-rounds each of three months duration.

10. ESTIMATION PROCEDURE

k = subscript for k-th sample household under a particular second stage stratum within an FSU/ hg/sb

D = total number of hg’s/sb’s formed in the sample village (panchayat ward) / block

Z = total size of a rural sub-stratum (= sum of sizes for all the FSUs of a rural sub-stratum )

n = number of sample village / block surveyed including zero cases but excluding casualty for a particular sub-sample and sub-stratum.

H = total number of households listed in a second-stage stratum of a village/block/hamlet-group/sub-block of sample FSU

h = number of households surveyed in a second-stage stratum of a village/block/hamlet-group/sub-block of sample FSU

y_stmidjk = observed value of the characteristic y for the k-th household in the j-th second stage stratum of the d-th hg/sb (d = 1, 2) of the i-th FSU belonging to the m-th sub-sample for the t-th sub-stratum of s-th stratum;

However, for ease of understanding, a few symbols have been suppressed in following paragraphs where they are obvious.

10.2 Formulae for Estimation of Aggregates for a particular sub-sample and stratum in Rural sector:

Overall estimate for aggregates for a stratum (

) based on two sub-samples is obtained as:

The overall estimate

at the State/ UT/ all-India level is obtained by summing the stratum estimates

over all strata belonging to the State/ UT/ all-India.

Let

and

be the overall estimate of the aggregates Y and X for two characteristics y and x respectively at the State/ UT/ all-India level.

A household is a group of persons normally living together and taking food from a common kitchen. A boarding and lodging house, a hotel or a hostel is treated as a cluster of households where each individual boarder(with his dependants or guests) forms a separate household. Households maintained and fed directly by institutional bodies such as those in prisons, police quarters, cantonments, hospitals, asylums, relief camps are, however, excluded from the scope of the survey.

Any person who is a normal resident of the sample household is considered to be a member of the household. The members of a household may or may not be related by blood to one another. Accordingly, any person who usually lives and takes the principal meals with the household is also considered a member of the household.

The number of normally resident members of a household formed the size of the household. It included temporary stay-aways but excluded temporary visitors and guests.

A household was classified as a rural labour household if its major source of income during the last 365 days preceding the survey was more from wage paid manual labour (agricultural and/or non-agricultural) than either from paid non-manual employment or from self-employment. Rural labour households include agricultural labour households also.

Of the households which are initially classified as `Rural Labour Households’, those deriving 50 percent or more of their total income from wage paid manual labour in agricultural activities are treated as agricultural labour households.

A household with cultivated land, either owned or taken on lease, was treated as household with land. Cultivated land was taken to mean the net area sown during the last calendar year (i.e. July to June) preceding the year of enquiry and included orchards and current fallows.

Land possessed means land ‘owned’ (including land under ‘owned-like possession’) and includes land ‘leased in’ but excludes land ‘leased out’ and any land held by the household which is neither owned nor leased in (e.g. encroached land etc.).

A job essentially involving physical labour is considered as manual work. However, jobs essentially involving physical labour but also requiring a certain level of general, professional, scientific or technical education are not to be termed as manual work. On the other hand, jobs not involving much of physical labour and at the same time not requiring much educational background, are to be treated as manual work. Thus, engineers, doctors, dentists, midwives, etc. are not considered as manual workers even though their jobs involve some amount of physical labour. But, peons, chowkidars, watchmen, etc., are considered as manual workers even though their work may not involve much physical labour.

A person who does manual work in return for wages in cash or kind or partly in cash and partly in kind (excluding exchange labour) is a wage paid manual labour. Salaries are also to be counted as wages. A person who is self-employed in manual work is not treated as a wage paid manual labour.

A Rural Labourer is defined as ‘one who does manual work in rural areas in agricultural and/or non-agricultural occupation in return for wages in cash or kind, or partly in cash and partly in kind.’ The term ‘wages’ included salary also. Any person who was self employed, though in manual work, was not treated as a wage paid manual rural labourer. Exchange labour was also excluded.

A person was treated as an agricultural labourer if he/she followed one or more of the following agricultural occupations in the capacity of a labourer on hire, whether paid wholly in cash or kind or partly in cash and partly in kind;

(e) any practice performed on a farm as incidental to or in conjunction with farm operations (including any forestry or timbering) and the preparation for market and delivery to storage or to market or to carriage for transportation to market of farm products.

It might be noted that manual work in fisheries was excluded from the purview of the category of agricultural labour. Further, carriage for transportation coming under the category (e) above, referred only to the first stage of transportation from farm to the first stage of disposal.

The entire spectrum of human activity falls into two categories – economic activities and non-economic activities. Any activity resulting in production of goods and services that adds value to national product was considered as an economic activity for the employment and unemployment survey of NSS 61^st round. Such activities included production of all goods and services for market (i.e. for pay or profit) including those of government services, and, the production of primary commodities for own consumption and own account production of fixed assets.

The usual occupation of a person was the economic activity which he may be pursuing during the major part of the 365 days preceding the date of survey.

It is the activity situation in which a person was found during the reference period with regard to the person’s participation in economic and non-economic activities. According to this, a person could be in one or a combination of the following three broad activity statuses during a reference period:

(ii) being not engaged in economic activity ( work) but either making tangible efforts to seek ’work’ or being available for ‘work’ if the ‘work’ is available, and

(iii) being not engaged in any economic activity (work) and also not available for ‘work’.

Broad activity statuses mentioned in (I) and (ii) above are associated with ‘being in labour force’ and the last with ’not being in the labour force’. Within the labour force, broad activity status (I) & (ii) were associated with ‘employment‘ and ‘unemployment’ respectively.

Persons who were engaged in any economic activity or who, despite their attachment to economic activity, abstained from work for reason of illness, injury or other physical disability, bad weather, festivals, social or religious functions or other contingencies necessitating temporary absence from work constituted ‘workers’. Unpaid helpers who assisted in the operation of an economic activity in the household farm or non-farm activities were also considered as workers.

Persons, who owing to lack of work, had not worked but either sought work through employment exchanges, intermediaries, friends or relatives or by making applications to prospective employers or expressed their willingness or availability for work under the prevailing condition or work and remunerations, were considered as those who were ‘seeking or available for work’ (or unemployed).

Persons who were either ‘working’ (or employed) or ‘seeking or available for work’ (or unemployed) during the reference period together constitute the ‘labour force’. Persons who were neither ‘working’ and at the same time nor ‘seeking or available for work’ for various reasons during the reference period were considered to be ‘out of labour force’. The persons under this category are students, those engaged in domestic duties, rentiers, pensioners, recipients of remittances, those living on alms, infirm or disabled persons, too young or too old persons, prostitutes, etc. and casual labourers not working due to sickness.

Persons who operated their own farm or non-farm enterprises or were engaged independently in a profession or trade on own-account or with one or a few partners were deemed to be self-employed in household enterprises. The essential feature of the self-employed is that they have autonomy (i.e., how, where and when to produce) and economic independence (i.e., market, scale of operation and money) for carrying out their operation. The remuneration received by them comprised two parts – share of their labour and profit of the enterprise. In other words, their remuneration was determined wholly or mainly by sales or profits of the goods or services which were produced. Self-employed persons were categorised as follows:

(i) Own-account workers: those self-employed persons who operated their enterprises on their own account or with one or a few partners and who, during the reference period, by and large, ran their enterprise without hiring any labour. They could, however, have had unpaid helpers to assist them in the activity of the enterprise;

(ii) Employers: those self-employed persons who worked on their own account or with one or a few partners and, who, by and large, ran their enterprise by hiring labour; and

(iii) Helpers in household enterprise: those self-employed persons (mostly family members) who were engaged in their household enterprises, working full or part time and did not receive any regular salary or wages in return for the work performed. They did not run the household enterprise on their own but assisted the related person living in the same household in running the household enterprise.

Persons working in other’s farm or non-farm enterprises, both household and non-household and getting in return salary or wages on a regular basis (and not on the basis of daily or periodic renewal of work contract) are the ’regular salaried/wage employees’. This category not only includes persons getting time wage but also persons receiving piece rate wage salary and paid apprentices, both full time and part-time.

A person casually engaged in other’s farm or non-farm enterprises (both household and non household) and getting in return wage according to the terms of the daily or periodic work contract is a ‘casual labour’. Depending on whether they are so employed in ‘public works’ sponsored by government agencies or local bodies or in other types of work, the casual workers are classified into two groups viz. casual labour in public works and casual workers in other types of work.

As stated in para 1.2 above , for each Rural Labour Enquiry, the Labour Bureau brings out five reports, highlighting different aspects of rural labour. The present report presents the analysis of data on employment and unemployment. This Report has been brought out in two Volumes. The Volume-I presents the main findings of the enquiry, whereas Volume-II contains ‘Appendices’, in which details of data have been presented.

approximate present population of the sample village	no. of hgs to be formed

less than 600 (no hamlet-groups)	1
600 to 899	3
900 to 1199	4
1200 to 1499	5
.………..and so on

Sl.No.	State/U.T.	No. of villages allottted	No. of villages surveyed	No.of persons
1	2.	3.	4.	5.
1	Andhra Pradesh	556	556	22591
2	Arunachal Pradesh	156	156	7409
3	Assam	340	335	17182
4	Bihar	436	436	23591
5	Chhattisgarh	200	200	10643
6	Delhi	8	8	246
7	Goa	16	16	677
8	Gujarat	232	232	11552
9	Haryana	168	168	9250
10	Himachal Pradesh	216	216	10263
11	Jammu & Kashmir	288	190	10772
12	Jharkhand	240	239	12454
13	Karnataka	288	288	13665
14	Kerala	368	368	14319
15	Madhya Pradesh	384	384	21120
16	Maharashtra	504	504	24276
17	Manipur	220	220	10969
18	Meghalaya	116	116	5664
19	Mizoram	80	80	4001
20	Nagaland	96	96	4847
21	Orissa	384	384	18755
22	Punjab	244	244	13184
23	Rajasthan	356	356	19887
24	Sikkim	92	92	4036
25	Tamil Nadu	416	416	16028
26	Tripura	176	176	8078
27	Uttaranchal	148	148	7334
28	Uttar Pradesh	792	792	47330
29	West Bengal	500	500	24282
30	A & N Islands	52	28	1174
31	Chandigarh	8	8	394
32	D & N Haveli	16	16	720
33	Daman & Diu	8	8	342
34	Lakshadweep	8	7	351
35	Pondicherry	16	16	639
All-India		8,128	7,999	3,98,025

RURAL LABOUR ENQUIRY (61st Round of N.S.S.) 2004–05 REPORT ON EMPLOYMENT & UNEMPLOYMENT OF RURAL LABOUR HOUSEHOLDS ( MAIN REPORT)

3. SCOPE:

4. GEOGRAPHICAL COVERAGE

relatively affluent households

10. ESTIMATION PROCEDURE

RURAL LABOUR ENQUIRY (61^st Round of N.S.S.) 2004–05 REPORT ON EMPLOYMENT & UNEMPLOYMENT OF RURAL LABOUR HOUSEHOLDS ( MAIN REPORT)