Odisha Skill Development Project (RRP IND 46462-003) DEMAND ANALYSIS A. Population Analysis 1. Odisha is a diverse state with few pockets of growth. According to the Census of India 2011, the population of Odisha is about 42 million with an uneven geographic distribution. Out of the 30 districts, six districts have a population of 2 million and above, accounting for 36% of the state’s population. Another 14 districts have a population of 1 million and above and account for another 48% of the population. Therefore, nearly 84% of the total population resides in just 20 districts of the state (Map 1). Map 1: High Population Districts in Odisha Note: Data are from the project preparatory technical assistance analysis. Source: Government of India. National Sample Survey, 2011–2012.New Delhi. 2. In a migration survey conducted in 2007–2008 as part of the National Sample Survey, nearly 11.4 million people from Odisha had a migratory status—almost 10.4 million moved within Odisha while 1.0 million people moved out of Odisha. Around 38% migrants were located in the coastal regions of Odisha and 33% were located in the northern regions. Among the other states, the largest number of people from Odisha located to Chhattisgarh (22.0%), followed by Andhra Pradesh (15.5%), West Bengal (14.3%), Maharashtra (11.3%), Gujarat (7.9%), and Uttar Pradesh (7.3%). Of those who migrated within Odisha, 17.8% reported to be working in the trade, hotel, and restaurant sector; 15.5% in manufacturing; 9.3% in transport; and 8.7% in construction. 3. The state also has the largest population proportion of tribals in the country. The scheduled tribe population is 9.6 million (22.9%) and the scheduled caste population is 7.2 million (17.2%). The national average for scheduled tribe is 8.6% and scheduled caste is 16.6%. 4. The youth population in Odisha is at an all-time high with nearly 34% population aged 15–34. However, the socioeconomic statistics of this age group is weak. The unemployment rate for this age group is 6.8% (India: 5.8%), while the underemployment rate is much higher at 10.8% (India: 5.9%). Only 6.6% of the youth have diploma, graduate, or postgraduate 2 certificates; 32.5% have education just up to grade 8; another 25.0% is educated only up to grade 10; and less than 10.0% have any kind of vocational training or higher education. Youth having received or receiving formal vocational training in Odisha is 1.8% (2.5% for men and 1.1% for women); lower than the India average of 3.7%. The same indicator is 0.4% for scheduled tribe women and 0.5% for scheduled caste women. B. Workforce Analysis 5. The labor force participation rate (LFPR) as of 2011–2012 in Odisha is higher than the country average. The LFPR among women is also higher. However, the LFPR for women has significantly come down from 40.7% in 1999–2000 to 28.8% in 2011–2012 for those aged 15– 34 and 43.2% to 34.7% for those aged 15–59 (Table 1). The same trend is also evident at the national level mainly triggered because of poor work conditions and poor wages (Table 1). Table 1: Labor Force Participation Rate—Time Series LFPR in PS +SS, 1991–2000; 2004–2005; 2011–2012 LFPR Odisha All India Odisha All India Ages 15–34 Ages 15–59 Male Female Total Male Female Total Male Female Total Male Female Total 1999–2000 79.1 40.69 59.1 79.1 37.26 58.4 87.3 43.16 65.0 86.5 41.47 64.4 2004–2005 85.41 47.02 65.28 79.66 40.53 60.22 90.4 49.74 69.83 87.14 45.4 66.65 2011–2012 80.12 28.76 53.25 70.93 27.52 49.58 89.55 34.67 61.62 82.74 33.11 58.32 LFPR = labor force participation7 rate 8 5 8 2 2 4 5 Note: Data from the project preparatory technical assistance analysis. Source: National Sample Survey, 2011–2012. 6. There are 25.5% main workers, 16.3% marginal workers, and 58.2% nonworkers in Odisha, per the Census of India, 2011. Nearly 6.5 million (15%) of the population reported to be seeking or available for work. Of this, 4.2 million (65%) are aged 15–34. Table 2: Worker Profile Odisha (million) Share India S. No. Worker Profile (%) (million) 1 Total workers 17.54 482 2 Main workers 10.71 363 3 Marginal workers 6.83 119 4 Nonworkers 24.43 729 5 Marginal workers seeking or available for work 3.73 55 6 Nonworkers seeking or available for work 2.65 61 7 Seeking or available for work aged 15–34 4.19 77 Source: Government of India. Census of India, 2011. 7. A large number of the population is engaged in agriculture and allied sectors, but construction (12.9%) and manufacturing (8.9) are major sectors for nonfarm employment in Odisha. Another 9% are engaged in wholesale and retail trade and repair of vehicles. While all other sectors are in line with India averages, the construction sector dominates nonfarm employment in Odisha, compared to the manufacturing sector, which dominates nonfarm employment at the national level. 3 Table 3: Sectoral Employment (%) S. No. Sector Odisha India 1 Agriculture, forestry, and fishing 53.42 47.04 2 Manufacturing 8.93 12.58 3 Construction 12.97 10.71 4 Wholesale and retail trade; repair of motor vehicles and motorcycles 8.93 9.89 5 Transportation and storage 3.71 4.41 6 Education 3.13 3.10 7 Accommodation and food service 1.73 1.74 8 Public administration and defense; compulsory social security 1.40 1.82 9 Others (mining, electricity, gas, water supply, health care, ICT) 5.79 8.71 ICT = information and communication technology. Note: Data are from the project preparatory technical assistance analysis. Source: National Sample Survey, 2011–2012. 8. The agriculture sector has mostly workers with low education levels, while those who are able to complete secondary and higher education move into nonfarm activities such as manufacturing, wholesale and retail trade, transportation, etc. The construction sector also engages a number of people with low education levels and low training. Many farm laborers easily switch between construction and agriculture activities due to the seasonal nature of agriculture. Due to high entry barriers in the education and public administration sectors, the percentage of workers with high education levels are highest than any other sector. Table 4: Distribution of Workers in Odisha by Education Attained, 2011–2012 Distribution (PS + SS) Secondary Diploma and and Up to Higher Certificate Graduate Illiterate Primary Middle Secondary Course and Above Agriculture, forestry , and fishing 39.68 26.76 23.67 8.72 0.03 1.14 Manufacturing 37.21 23.19 23.40 11.14 1.55 3.50 Construction 37.66 31.48 20.02 8.19 0.25 2.38 Wholesale and retail trade; repair of motor vehicles and motorcycles 14.66 18.62 31.49 24.48 0.65 10.1 Transportation and storage 14.83 27.91 32.99 17.66 0.28 6.33 Education 0.68 5.18 13.40 18.01 1.69 61.04 Accommodation and food service 8.54 42.42 29.20 18.97 0 0.87 Public administration and defense 2.70 6.25 15.95 37.42 0.72 36.95 Otherscompulsory (mining, social electricity, security gas, water supply, health care, ICT) 13.36 20.32 20.56 23.12 2.85 19.80 Total 32.86 25.40 23.70 12.03 0.47 5.55 ICT = information and communication technology Note: Data are from the project preparatory technical assistance analysis. Source: National Sample Survey, 2011–2012. 9. The movement of workers from agriculture and allied sectors is also an indication of the changing economy and greater dependence on the industry and services sectors. The employment share in industry in Odisha has gone up from 10.0% to 23.1% (by 13.09 bps1 whereas India is up by 9.56 bps); while the services sector has gone up from 16.6% to 24.9% (by 8.39 bps while India is up by 6.47 bps). The share of agriculture sector has come down from 72.1% to 51.5% (by 20.63 bps compared to 15.82 bps at the all-India level). 1 Basis percentage points. 4 Table 5: Distribution of Workers Aged 15–59 in the Labor Force Odisha India Year Agriculture Mining Industry Services Agriculture Mining Industry Services 1993–1994 72.08 1.36 10.02 16.55 61.04 0.84 15.07 23.06 1999–2000 68.33 0.92 13.26 17.49 58.52 0.63 16.16 24.69 2004–2005 59.82 0.88 18.50 20.80 54.63 0.66 18.81 25.90 2009–2010 57.51 1.05 20.18 21.26 49.82 0.72 21.97 27.49 2011–2012 51.45 0.50 23.11 24.94 45.22 0.62 24.63 29.53 Note: Data are from the project preparatory technical assistance analysis. Source: National Survey, 2011–2012. 10. Formal employment in the unorganized sector in Odisha is very high compared to the national average. This means that establishments of the unorganized sector (employing less than 10 workers) also provide benefits and security to its workers; therefore, respondents of the survey tend to term their employment as “formal.” However, for the rest of the country, the vastness of informal employment in the unorganized sector is a serious issue from the point of view of labor security and labor rights.