UPSC Economics People as Resource NCERT Extracts - People as Resource

Introduction

• 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 emphasises its ability to contribute to the creation of the Gross National Product.
• Like other resources population also is a resource - a 'human resource1'. 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 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 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.
• Not only do the more educated and the healthier people gain through higher incomes, society also gains 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 liability. It 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 modem technology, useful scientific researches and so on.
• Investment in human resource (via education and medical care) can give high rates of return in the future. This investment on people is the same as investment in land and capital. One invests in shares and bonds expecting higher return in the future.
• A child, too, with investments made on his/her education and health, can yield a high return in the future in the form of higher earnings and greater contribution to 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 countries. 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 resource like land and capital. Efficiency and the technology evolved by people have made these countries rich/developed.

Economic Activities by Men and Women

• 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 any one 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.
• 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 organised 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.

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 poulation ultimately decides the growth rate of the country. Illiterate and unhealthy population are a liability for the economy. Literate and healthy population are an asset.

Education

• Education contributes towards the growth of society. 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. 3766.90 crore in the eleventh plan. The expenditure on education as a percentage ofGDP rose from 0.64 per cent in 1951-52 to 3.3 per cent in 2013-14 (B.E. - Budgetary estimate).
• The literacy rates have increased from 18 per cent in 1951 to 74 per cent in 2010-11.
• Literacy is not only a right, it is also needed if the citizen are to perform their duties and enjoy their rights properly.
• However, a vast difference is noticed across different sections of population. Literacy among males is nearly 16.6 per cent higher than females and it is about 16.1 per cent higher in urban areas as compared to the rural areas.
• In 2011 Literacy rates vary from 94 per cent in Kerala to 62 per cent in Bihar. The primary school system has expanded to over 7.68 lakhs in 2004-05.
• 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 six to fourteen years by 2010. It is a timebound 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 back-to-school camps have been initiated to increase the enrollment 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 eleventh plan endeavoured to increase the enrolment in higher education of the 18 to 23 years age group to 15 per cent by 2011-12 and to 21 per cent by twelfth plan.
• The strategy focuses on increasing access, quality, adoption of states-specific curriculum modification, vocationalisation and networking on the use of information technology.
• The plan also focuses on distant education, convergence of formal, non-formal, distant and IT education institutions.
• Over the past fifty years, there has been a significant growth in the number of university and institutions of higher learning in specialised areas.
• Human being is a positive asset and a precious national resource which needs to be cherished, nurtured and developed with tenderness and care, coupled with dynamism.
• Each individual's growth presents a different range of problems and requirements.
• The catalytic action of education in this complex and dynamic growth process needs to be planned meticulously and executed with great sensitivity.

Health

• The health of a person helps him to realise his potential and the ability to fight illness.
• An unhealthy person becomes a liability for an 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 health care, family welfare and nutritional service with a special focus on the under-privileged segment of population.
• Over the last five decades India has built up a vast health infrastructure and has developed man power required at primary, secondary and tertiary sector in Government as well as in the private sector.
• Increase in life expectancy and improvement in child care 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 nutrition along with mother and child care.
• There are many places in India which do not have even these basic facilities. There are only 381 medical colleges in the country and 301 dental colleges.
• Just four states like Andhre Pradesh, Kamataka, Maharastra and Tamil Nadu have maximum number of colleges.

Unemployment

• Unemployment is said to exist when people who are willing to work at the going wages cannot find jobs. The workforce population includes people from 15 years to 59 years.
• 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 dependant 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.
• 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 the secondary or the tertiary sector.
• In the secondary sector, small scale manufacturing is the most labour-absorbing.
• In case of the tertiary sector, various new services are now appearing like biotechnology, information technology and so on.

Important Facts

• Infant mortality rate is the death of a child under one year of age.
• Birth rates is the number of babies born there for every 1,000 people during a particular period of time.
• Death rate is the number of people per 1,000 who die during a particular period of time.