UP, West Bengal, and Maharashtra Lead in Informal Sector Enterprises in 2022-23

Among the major states, Uttar Pradesh recorded a 13.83 per cent share of informal sector enterprises in 2022-23
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In 2022-23, Uttar Pradesh, West Bengal, and Maharashtra emerged as the states with the highest share of informal sector enterprises in both rural and urban areas. This insight comes from the Annual Survey of Unincorporated Enterprises for 2022-23, released by the Ministry of Statistics and Programme Implementation (MoSPI).

Informal Sector Trends Post-Pandemic

The survey highlighted a mixed trend in the share of informal sector enterprises post-pandemic. States like Gujarat, Haryana, Karnataka, Kerala, Madhya Pradesh, Tamil Nadu, and West Bengal experienced a decrease in their share of informal enterprises. However, Uttar Pradesh saw a notable increase, topping the list among major states.

  • Uttar Pradesh: Recorded a 13.83% share of informal sector enterprises in 2022-23, up from 12.99% in the previous year.
  • West Bengal: Held the second position with a 12.04% share, slightly down from 12.31% in 2021-22.
  • Maharashtra: Increased its share to 9.37% from 8.81% in the same period.

Employment in the Informal Sector

The survey also revealed changes in the employment landscape within the informal sector across various states. A comparison with data from the National Sample Survey’s 73rd round on Unincorporated Enterprises for 2015-16 showed varying trends:

  • Uttar Pradesh: Informal sector workers decreased to 1.57 crore in 2022-23 from 1.65 crore in 2015-16 but rose from 1.30 crore in 2021-22.
  • West Bengal: Informal sector workers declined to 1.05 crore in 2022-23 from 1.35 crore in 2015-16, but the number increased slightly from 1.02 crore in 2021-22.
  • Maharashtra: Showed a consistent increase in informal sector workers, rising to 1.15 crore in 2022-23 from 91.23 lakh in 2015-16 and 98.81 lakh in 2021-22.

Lowest Share of Informal Enterprises

States with the lowest share of informal sector enterprises included Uttarakhand, Assam, Chhattisgarh, Delhi, and Jammu & Kashmir. However, Delhi saw a significant rise in its share of informal enterprises, jumping to 1.43% in 2022-23 from 0.64% in 2021-22.

Significance of the Survey

The survey data, collected after a long gap, serves as a crucial indicator of the informal sector’s capacity to generate employment and absorb labor, especially during slowdowns in the formal sector. In 2022-23, the unincorporated non-agricultural sector employed over 10.96 crore workers, including working owners, hired workers, unpaid family members, and others. This was an increase from 9.79 crore workers in 2021-22.

  • Urban Workers: 5.72 crore in 2022-23, up from 5.03 crore in 2021-22.
  • Rural Workers: 5.24 crore in 2022-23, up from 4.76 crore in 2021-22.

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