OVERVIEW
• The chapter ‘People as Resource’ is an effort to explain population as an
asset for the economy rather than a liability.
• Population becomes human capital when there is investment made in the
form of education, training and medical care.
• In fact, human capital is the stock of skill and productive knowledge
embodied in them.
• ‘People as Resource’ is a way of referring to a country’s working people in
terms of their existing productive skills and abilities.
• Looking at the population from this productive aspect emphasizes the
ability to contribute to the creation of the Gross National product.
• Like other resources population also is a resource a ‘human resource’.
• This is the positive side of a large population that is often overlooked
when we look only at the negative side, considering only the problems of
providing the population with food education and access to health
facilities.
• When the existing ‘human resource’ is further developed by becoming
more education and access to health facilities.
• When the existing ‘human resource’ is further developed by becoming
more educated and healthy, we call it human capital formation ‘ that adds
to the productive power of the country just like physical capital formation’.
• Investment in human capital (through education, training medical care)
yields a return just like investment in physical capital.
• This can be seen directly in the form of higher incomes earned because of
higher incomes earned because of higher productivity of the more
educated or the better trained persons, as well as the higher productivity
of healthier people.
• India’s Green Revolution is a
dramatic example of how the
input of greater knowledge in the
form of improved production
technologies can rapidly increase
the productivity of scarce land
resources.
• India’s It revolution is a striking
instance of how the importance of
human capital has come to acquire
a higher position than that of
material, plant and machinery.
LET’S DISCUSS
Looking at the photograph can you
explain how a doctor, teacher,
engineer and a tailor are an asset to
the economy ?
• Not only do the more educated and the healthier people gain through
higher incomes, society also gain in other indirect ways because the
advantages of a more educated or a healthier population spreads to those
also who themselves were not directly educated or given health care.
• In fact, human capital is in one way superior to other resources like land
and physical capital human resource can make use of land and capital.
• Land and capital cannot become useful on its own!
• For many decades in India, a large population has been considered a
liability rather than an asset. But a large population need not be a burden
for the economy.
• If can be turned into a productive asset by investment in human capital
(for example, by spending resources on education and health for all,
training of industrial and agricultural workers in the use of modern
technology, useful scientific researches and so on).
• The two following cases illustrate how people can try to become a more
productive resources.
STORY OF SAKAL
There were two friends vilas and Sakal living in the same village Semapur.
Sakal was a twelve – year old boy. His mother Sheela looked after domestic
chores. His father Buta Chaudhary worked in an agricultural field. Sakal
helped his mother in domestic chores. He also looked after his younger
brother Jeetu and sister Seetu. His uncle shyam had passed the matriculation
examination, but, was sitting idle in the house as he had no job. Buta and
Sheela were eager to teach Sakal They forced him to join the village school
which he soon joined. He started studying and completed his higher
secondary examination
His father persuaded him to continue his studies. He raised a loan for Sakal
to study a vocational course in computers. Sakal was meritorious and
interested in studies from the beginning. With great vigor and enthusiasm he
completed his course. After some time he got a job in a private firm. He even
designed a new kind of software. This software helped him increase the sale
of the firm. His boses acknowledged his services and rewarded him with a
promotion.
STORY OF VILAS
Vilas was an eleven – year old boy residing in the same village as sakal.
Vilas’s father Mahesh was a fisherman. His father passed away when he was
only two years old. His mother Geeta sold fish to earn money to feed the
family. She bought fish from the landowner’s pond and sold it in the nearby
mandi. She could earn only Rs. 150 a day be selling fish. Vilas became a
patient of arthritis. His mother could not afford to take him to the doctor. He
could not go to school either. He was not interested in studies. He helped his
mother in cookig and also looked after his younger brother Mohan.
After some time his mother fell sick and there was no one to look after her.
There was no one in the family to support them. Vilas, too, was forced to sell
fish in the same village. He like his mother earned only a meagre income.
LETS’ DISCUSS
Do you notice any difference between the two friends ? What are those ?
• In the two case studies we saw Sakal went to school and Vilas did not
go. Sakal was physically strong and health. There was no need for him
to visit the doctor frequently.
• Vilas was a patient of arthritis
• He lacked the means to visit the doctor.
• Sakal acquired a degree in computer programming.
• Sakal found a job in a private firm while Vilas continued with the same
work as his mother.
• He earned a meagre income like his mother to support a family.
• In the case of Sakal, several years of education added to the quality of
labour.
• This enhanced his total productivity.
• Total productivity adds to the growth of the economy.
• This in turn pays an individual through salary or in some other form of
his choice.
• In case of Vilas, there could not be any education or health care in the
early part of his life.
• He spends his life selling fish like his mother.
• Henceforth, he draws the same salary of unskilled labourer as his
mother.
• Investment in human resource (via education and medical care) can
give high rates of return in future.
• This investment on people is the same as investment in land and
capital.
• A child, too, with investments made on her education and health, can
yield a high return in future in the form of higher earnings and greater
contribution to the society.
• Educated parents are found to invest more heavily on the education of their
child.
• This is because they have realised the importance of education for
themselves.
• They are also conscious of proper nutrition and hygiene. They accordingly
look after their children’s needs for education at school and good health.
• A virtuous cycle is, thus, created in this case.
• In contrast, a vicious cycle may be created by disadvantaged parents, who
themselves uneducated and lacking in hygiene, keep their children in a
similarly disadvantaged state.
• Countries, like Japan, have invested in human resource.
• They did not have any natural resource.
• These countries are developed/rich.
• They import the natural resource needed in their country.
• How did they become rich/developed?
• They have invested on people, especially in the field of education and
health.
• These people have made efficient use of other resources, like land and
capital.
• Efficiency and the technology evolved by people have made these countries
rich/developed.
Economic Activities by Men and Women
• Like Vilas and Sakal, people have been engaged in various activities.
• We saw that Vilas sold fish and Sakal got a job in the firm. The various
activities have been classified into three main sectors i.e., primary,
secondary and tertiary.
• Primary sector includes agriculture, forestry, animal husbandry, fishing,
poultry farming, mining and quarrying.
• Manufacturing is included in the secondary sector. Trade, transport,
communication, banking, education, health, tourism, services, insurance,
etc. are included in the tertiary sector.
• The activities in this sector result in the production of goods and services.
• These activities add value to the national income.
• These activities are called economic activities.
• Economic activities have two parts — market activities and non-market
activities.
• Market activities involve remuneration to anyone
who performs i.e., activity performed for pay or
profit.
• These include production of goods or services,
including government service.
• Non-market activities are the production for
self-consumption. These can be consumption and
processing of primary product and own account
production of fixed assets.
• Due to historical and cultural reasons there is a division of labour between
men and women in the family.
• Women generally look after domestic chores and men work in the fields.
Sakal’s mother Sheela cooks food, cleans utensils, washes clothes, cleans
the house and looks after her children.
• Sakal’s father Buta cultivates the field, sells the produce in the market and
earns money for the family.
• Sheela is not paid for the services delivered for upbringing of the family.
• Buta earns money, which he spends on rearing his family. Women are not
paid for their service delivered in the family.
• Women are not paid for their service delivered in the family.
• The household work done by women isnot recognised in the National
Income.
• Geeta, mother of Vilas, earned an income by selling fish. Thus women are
paid for their work when they enter the labour market.
• Their earning like that of their male counterpart is determined on the basis
of education and skill.
• Education helps individual to make better use of the economic opportunities
available before him. Education and skill are the major determinants of the
earning of any individual in the market.
• A majority of women have meagre education and low skill formation.
• Women are paid low compared to men.
• Most women work where job security is not there.
• Various activities relating to legal protection is meagre.
• Employment in this sector is characterised by irregular and low income.
• In this sector there is an absence of basic facilities like maternity leave,
childcare and other social security systems.
• However, women with high education and skill formation are paid at par with
the men.
• Among the organized sector, teaching and medicine attract them the most.
Some women have entered administrative and other services including job,
that need high levels of scientific and technological competence.
• Ask your sister or your classmate what she would like to take up as a career?
• In this sector there is an absence of basic facilities like maternity leave,
childcare and other social security systems.
• However, women with high education and skill formation are paid at par with
the men.
• Among the organized sector, teaching and medicine attract them the most.
Some women have entered administrative and other services including job,
that need high levels of scientific and technological competence.
• Ask your sister or your classmate what she would like to take up as a career?
QUALITY OF POPULATION
• The quality of population depends upon the literacy rate, health of a person
indicated by life expectancy and skill formation acquired by the people of
the country.
• The quality of the population ultimately decides the growth rate of the
country.
• Literate and healthy population are an asset.
Education
• Sakal’s education in the initial years of his life bore him the fruits in the later
years in terms of a good job and salary.
• We saw education was an important input for
the growth of Sakal.
• It opened new horizon for him, provided new
aspiration and developed values of life.
• Not only for Sakal, education contributes
towards the growth of society also. It enhances
the national income, cultural richness and
increases the efficiency of governance.
• There is a provision made for providing universal access, retention and
quality in elementary education with a special emphasis on girls.
• There is also an establishment of pace setting of schools like Navodaya
Vidyalaya in each district.
• Vocational streams have been developed to equip large number of high
school students with occupations related to knowledge and skills.
• The plan outlay on education has increased from Rs 151 crore in the first
plan to Rs 99,300 crore in 2020–21.
• The expenditure on education as a percentage of GDP rose from 0.64% in
1951–52 to 3.1% in 2019–20 (B.E.) and has remained stagnant around 3%
from past few years.
LET’S DISCUSS
Study the graph and answer the following questions:
1. Has the literacy rates of the population increased since 1951?
2. In which year India has the highest literacy rates?
3. Why literacy rate is high among the males of India?
4. Why are women less educated than men?
5. How would you calculate literacy rate in India?
6. What is your projection about India’s literacy rate in 2025?
• The Budgetary Estimate as stated in the Budget Documents of Union State
Governments, Reserve Bank of India, the expenditure on education as a
percentage of GDP has declined to 2.8% in 2020–21 (B.E.)
• The literacy rates have increased from 18% in 1951 to 85% in 2018. Literacy
is not only a right, it is also needed if the citizens are to perform their duties
and enjoy their rights properly.
• However, a vast difference is noticed across different sections of the
population.
• Literacy among males is nearly 16.1% higher than females and it is about
14.2% higher in urban areas as compared to rural areas.
• As per 2011 census, literacy rates varied from 94% in Kerala to 62% in Bihar.
• The primary school system (I–V) has expanded to over 7,78,842, lakh in
2019–20. Unfortunately this huge expansion of schools has been diluted by
the poor quality of schooling and high dropout rates.
• “Sarva Siksha Abhiyan is a significant step towards providing elementary
education to all children in the age group of 6–14 years by 2010...
• It is a time-bound initiative of the Central government, in partnership with
the States, the local government and the community for achieving the goal
of universalisation of elementary education.”
• Along with it, bridge courses and backto- school camps have been initiated
to increase the enrolment in elementary education.
• Mid-day meal scheme has been implemented to encourage attendance and
retention of children and improve their nutritional status.
• These policies could add to the literate population of India.
• The Gross Enrolment Ratio (GER) in higher education in the age group of 18
to 23 years is 27% in 2019–20, which would be broadly in line with world
average.
• The strategy focuses on increasing access, quality, adoption of state-specific
curriculum modification, vocationalisation and networking on the use of
information technology. There is also focuse on distance education,
convergence of formal, non-formal, distance and IT education institutions.
• Over the past 60 years, there has been a significant growth in the number
of university and institutions of higher learning in specialised areas.
• Let us read the table to see the increase in the number of college,
universities, enrolment of students and recruitment of teachers from 1951
to 2019–20.
LET’S DISCUSS
Discuss this table in the classroom and answer the following questions.
1. Is the increase in the number of colleges adequate to admit the increasing
number of students?
2. Do you think we should have more number of universities?
3. What is the increase noticed among the teachers in the year 2015–16.
4. What is your idea about future colleges and universities?
HEALTH
• Firm maximise profit: Do you think any firm would be induced to employ
people who might not work efficiently as healthy workers because of ill
health?
• The health of a person helps him to realise his/her potential and the ability
to fight illness.
• He/She will not be able to maximize his/her
output to the overall growth of the organisation.
• Indeed; health is an indispensable basis for
realising one’s well-being.
• Henceforth, improvement in the health status of the
population has been the priority of the country.
• Our national policy, too, aims at improving the accessibility of healthcare,
family welfare and nutritional service with a special focus on the
underprivileged segment of the opulation.
• Over the last five decades,India has built a vast healt infrastructure and
has also developed the manpower required at primary, secondary and
tertiary sector in government, as well as, in the private sector.
These measures, which have been adopted, have increased the life
expectancy to over 69.4 years in 2016. *Infant mortality rate (IMR) has come
down from 147 in 1951 to 36 in 2020. **Crude birth rates have dropped to
20.0 (2018) and ***death rates to 6.2 (2018) within the same duration of
time. Increase in life expectancy and improvement in childcare are useful in
assessing the future progress of the country. Increase in longevity of life is an
indicator of good quality of life marked by self-confidence. Reduction in
infant mortality involves the protection of children from infection, ensuring
the nutrition of both the mother and the child, and childcare.
LET’S DISCUSS
Study Table 2.2 and answer the following questions.
1. What is the percentage increase in dispensaries from 1951 to 2020?
2. What is the percentage increase in doctors and nursing personnel
from 1951 to 2020?
3. Do you think the increase in the number of doctors and nurses is
adequate for India? If not, why?
4. What other facilities would you like to provide in a hospital?
5. Discuss about the hospital you have visited?
6. Can you draw a graph using this table.
• There are many places in India which do not have even these basic
facilities.
• There are only 542 medical colleges in the country and 313 dental
colleges.
• Just four states, like Andhra Pradesh, Karnataka, Maharastra and Tamil
Nadu have the maximum number of medical colleges.
UNEMPLOYMENT
• Sakal’s mother Sheela looked after the domestic chores, children and
helped her husband Buta in the field.
• Sakal’s brother, Jeetu, and sister, Seetu, spend their time playing and
roaming.
• Can you call Sheela or Jeetu or Seetu unemployed? If not, why?
• Unemployment is said to exist when people who are willing to work at the
going wages cannot find jobs.
• Sheela is not interested in working outside her domestic domain.
• Jeetu and Seetu are too small to be counted in the work force
population.
• Neither Jeetu, Seetu or Sheela can be counted as unemployed.
• The workforce population includes people from 15 years to 59 years.
• Sakal’s brother and sister do not fall within this age group so they
cannot be called unemployed.
• Sakal’s mother Sheela works for the family.
• She is not willing to work outside her domestic domain for payment.
• She too cannot be called unemployed.
• Sakal’s grandparents (although not mentioned in the story) cannot be
called unemployed.
• In case of India we have unemployment in rural and urban areas.
However, the nature of unemployment differs in rural and urban areas. In
case of rural areas, there is seasonal and disguised unemployment.
• Urban areas have mostly educated unemployment.
• Seasonal unemployment happens when people are not able to find jobs
during some months of the year.
• People dependant upon agriculture usually face such kind of problem.
There are certain busy seasons when sowing, harvesting, weeding and
threshing is done
• Certain months do not provide much work to the people dependent on
agriculture.
• In case of disguised unemployment people appear to be employed.
• They have agricultural plot where they find work.
• This usually happens among family members engaged in agricultural
activity.
• The work requires the service of five people but engages eight people.
• Three people are extra.
• These three people also work in the same plot as the others.
• The contribution made by the three extra people does not add to the
contribution made by the five people.
• If three people are removed the productivity of the field will not decline.
The field requires the service of five people and the three extra people
are disguised unemployed.
• In case of urban areas educated unemployment has become a common
phenomenon.
• Many youth with matriculation, graduation and post graduation degrees
are not able to find job.
• A study showed that unemployment of graduate and post-graduate has
increased faster than among matriculates.
• A paradoxical manpower situation is witnessed as surplus of manpower in
certain categories coexist with shortage of manpower in others.
• There is unemployment among technically qualified person on one hand,
while there is a dearth of technical skills required for economic growth.
• Unemployment leads to wastage of manpower resource.
• People who are an asset for the economy turn into a liability.
• There is a feeling of hopelessness and despair among the youth.
• People do not have enough money to support their family.
• Inability of educated people who are willing to work to find gainful
employment implies a great social waste.
• Unemployment tends to increase economic overload.
• The dependence of the unemployed on the working population increases.
• The quality of life of an individual as well as of society is adversely affected.
• When a family has to live on a bare subsistence level there is a general decline in its
health status and rising withdrawal from the school system.
• Hence, unemployment has detrimental impact on the overall growth of an economy.
• Increase in unemployment is an indicator of a depressed economy.
• It also wastes the resource, which could have been gainfully employed.
• If people cannot be used as a resource they naturally appear as a liability to the
economy.
• In case of India, statistically, the unemployment rate is low.
• A large number of people represented with low income and productivity
are counted as employed.
• They appear to work throughout the year but in terms of their potential
and income, it is not adequate for them.
• The work that they are pursuing seems forced upon them.
• They may therefore want other work of their choice.
• Poor people cannot afford to sit idle.
• They tend to engage in any activity irrespective of its earning potential.
• Their earning keeps them on a bare subsistence level.
• Moreover, the employment structure
is characterised by self-employment in
the primary sector.
• The whole family contributes in the field
even though not everybody is really
needed.
• So there is disguised unemployment in
the agriculture sector. But the entire
family shares what has been produced.
• This concept of sharing of work in the field and the produce raised reduces
the hardship of unemployment in the rural sector.
• But this does not reduce the poverty of the family, gradually surplus labour
from every household tends to migrate from the village in search of jobs.
• Let us discuss about the employment scenario in the three sectors
mentioned earlier. Agriculture, is the most labour absorbing sector of the
economy. In recent years, there has been a decline in the dependence of
population on agriculture partly because of disguised unemployment
discussed earlier.
• Some of the surplus labour in agriculture has moved to either
Story of a Village
There was a village inhabited by several families. Each family produced
enough to feed its members. Each family met its needs by the members
making their own clothes and teaching their own children. One of the families
decided to send one of its sons to an agriculture college. The boy got his
admission in the nearby college of agriculture. After some time he became
qualified in agroengineering and came back to the village. He proved to be so
creative that he could design an improved type of plough, which increased
the yield of wheat. Thus a new job of agroengineer was created and filled in
the village.
The family in the village sold the surplus in a nearby neighbouring
village. They earned good profit, which they shared among themselves.
Inspired by this success all the families after some time held a meeting in the
village. They all wanted to have a better future for their children too. They
requested the panchayat to open a school in the village. They assured the
panchayat that they would all send their children to school. The panchayat,
with the help of government, opened a school. A teacher was recruited from a
nearby town. All the children of this village started going to school. After
sometime one of the families gave training to his daughter in tailoring.
She started stitching clothes for all the families of the village for everyone
now wanted to buy and wear well-tailored clothes. Thus another new job,
that of a tailor was created. This had another positive effect. The time of the
farmers in going far for buying clothes was saved. As the farmers spent more
time in the field, the yield of the farms went up. This was the beginning of
prosperity. The farmers had more than what they could consume. Now they
could sell what they produced to others who came to their village markets.
Over time, this village, which formally had no job opportunities in the
beginning, had many like teacher, tailor, agro– engineer and many more.
This was the story of a simple village where the rising level of human capital
enabled it to evolve into a place rich with complex and modern economic
activities.
SUMMARY
You have seen how inputs like education and health helped in making
people an asset for the economy. The chapter also discusses about the
economic activities undertaken in the three sectors of the economy. We
also study about the problem associated with unemployment. Finally the
chapter ends with the story of a village which formally had no job but later
had plenty.
THANK YOU
