They want wages

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: Indian data have a fuzzy category called self-employment and in 2004- 05, 56.5% of the work force reported itself as being self-employed. In the non-agricultural work force, 62.8% of workers reported themselves as self-employed.

There are also wide inter-State variations. For instance, more than 65% of non-agricultural workers reported themselves as self-employed in Andhra Pradesh (65.2%), Assam (65.6%), Bihar (80.8%), Jammu and Kashmir (73.7%), Madhya Pradesh (65.5%), Orissa (70.3%), Uttar Pradesh (68.1%), West Bengal (68.2%) and Uttarakhand (67.2%). In contrast, the figure was lower than 50% in Himachal Pradesh (48.4%) and Kerala (47.9%). The higher the degree of self-employment, the lower seems to be the prosperity of the State. This suggests that self-employment is not a viable occupational category at all. It is a subsistence-level occupation because people cannot afford to remain unemployed.

Outside of agriculture, the total self-employed population is 92.1 million. Some of these are in relatively high income occupations, like independent professionals (doctors, lawyers, artists, accountants), shop owners in urban areas, rice-mill owners, workshop owners, commission agents, real estate and housing brokers and owners of small hotels and restaurants. But others are in relatively low income occupations, like handloom weavers (mostly women), chikan workers (mostly women), street vendors, food processors, rickshaw pullers, rag-pickers, beedi rollers (mostly working out of home), agarbatti makers (mostly women), potters and bamboo-product makers.

The point about this fourth transition is that self-employed workers in the relatively low income categories would be better off in wage employment, were that to be possible. And 87% of own account enterprises are actually in rural areas, which is why the rural transformation also becomes important. The average own account enterprise is low on assets and low on value addition.

The average value addition is Rs 2,175 per month in urban areas and Rs 1,167 per month in rural areas. Depending on the family size, this is not enough to ensure livelihood above the poverty line. 84.9% of own account enterprises are not registered and this needs to be flagged, because registration also brings attendant benefits, such as access to credit or government subsidies on marketing and technology.