The Landscape of Self-Employment in India: Trends, Constraints and Policy Prescriptions

Farzana Afridi

No 17842, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper assesses the structure and quality of self-employment in India over a decade. India, historically, has had a much larger share of workers who are self-employed and a smaller proportion of wage and salaried workers. This structure of labour force participation has not shifted much in decades. In recent years, the proportion of self-employed has risen relative to the pre-pandemic era, and much more so for women. At the same time, significant underemployment accompanies low earnings of the self-employed. The paper highlights three key constraints for improving the quality of or transitioning out of self-employment – vocational skilling, access to formal credit and legal support for entrepreneurship. It concludes by discussing the implications of technological change and digitization for self-employment and the need for reforming the legal framework of self-employment in India.

Keywords: quality of work; gender; trends; self-employment; India (search for similar items in EconPapers)
JEL-codes: J2 J24 J31 (search for similar items in EconPapers)
Date: 2025-04
New Economics Papers: this item is included in nep-ent, nep-iue and nep-lma
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