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A Story of Growth

The 6th Economic Census has thrown up a growth story and the numbers don’t lie. At the all-India level the number of employed rose 34.35 per cent in the last eight years or at four per cent per year. The number of establishments rose 41.7 per cent and nearly 60 per cent of these are in rural areas. The average employment per establishment however, fell from 2.3 to 2.1 workers which might indicate that labour intensive jobs are on the decline. Uttar Pradesh, which created 75 per cent more jobs, was the top performer among the big states. The census does not include employment in agriculture, public administration, defence and compulsory social security services activities. The employment growth would have been lower if these sectors were included.
Goa has, by and large, kept pace with the national average. The number of business establishments in the state has increased by 32.39 per cent in the last eight years or from 73,515 in 2005 to 97,326. Of these 64,919 are located in urban areas. The number of workers increased by 28.9 per cent to 2.94 lakh, of which 2.09 lakh are employed in urban areas. When compared with the small states of Manipur, Assam and Sikkim, Goa lags behind. In these three states the number of employed rose between 77 and 83 per cent, which is way ahead of Goa.
The economic census provides important data which can be used by private enterprises as well as state and central governments to access business activities, formulate taxation policies and frame labour laws. Private enterprises and traders could use the data to identify new growth areas, study market trends and locate potential markets. The survey also provides a rough socio-economic picture and gives pointers on the rural-urban divide. In Goa, for example, there appears to be a shift of workers from rural areas to urban which could explain the rush for housing in towns and cities.
The census also has its limitations. The survey is based on information given orally and not on the basis of records. Hence there could be under-reporting of employed and unintended inaccuracies. Although the report claims that the establishments covered produce 85 per cent of the GDP, the fact that a lot of non-profit organisations have been left out means a lot of employed persons have not been accounted for. The first census conducted in 1977 included turnover in production and value which produced more accurate indicators on the contribution of establishments towards the GDP. This was subsequently dropped as a result of which the data became more generalised. For example the data does not give a co-relation between increase in number of establishments and value of goods produced or sold. It does not tell us which sector is growing faster. Since Goa has a large tourism industry one would expect the data to throw light on which areas are growing and whether increase in number is adding value. This sort of co-relation would be important to Goa on account of paucity of land. It would point the government in the direction of higher growth with judicious use of resources.
Since the exercise is being conducted every eight or ten years, it would serve all those involved in economic activity if more parameters are added to census so that the data collected can be more meaningful. The counter argument is that the census is meant to provide a broad picture and it is the duty of state government to conduct additional surveys to suit the specific needs of the state.
While this is true, additional surveys increase costs and need more time. Perhaps, the inclusion of one or two key parameters like output and turnover would produce better results.

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