Economic globalisation is the increasing interdependence of World economics as a result of the growing scale of cross-border trade of commodities and services, the flow of international capital and wide. While some people believe that globalisation does translate into substantial job creation in developing countries. Others believe that it leads to job loss.
Globalisation of the Indian economy through various economic reforms like deregulation and privatisation has led to the downsizing of employment in public sector and in several private sector companies of late due to the slowdown in the global economy, thereby compounding the widespread job shift to the informal economy.
Increased informalisation is detrimental to the development of the country.
- The income of the workers received from informal employment is very low. These workers and their families have to live on the edge of poverty or even below poverty level.
- Informal jobs are outside of the sphere of government’s supervision over the labour markets. This means the informal workers don’t have a formal contract that might protect them to a certain level from losing their job.
- They are not protected regarding the working hours, health and safety at the working place.
- There is no guarantee that they’d get wages on time and in full, as it is not embedded in any formal document that would ensure its validity.
Such workers are not given any type of mandated benefits that would normally be a feature of “formal” employment opportunities, either in private sector firms or in the public sector. When large sections of labour are not given protection, it is definitely detrimental to the development of the country.