Extend social security for workers in Odisha

Experts say the growing informalisation of the formal sectors’ workforce may have led to the absence of institutional social security nets.
Image used for representation.
Image used for representation.(Photo | Express Illustrations)
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2 min read

A rapid structural change in the economy notwithstanding, social security continues to elude a large chunk of the labour force in Odisha. Two reports, completely different in scope and objective, give a clear picture of the situation.

A recently released study of financial inclusion in rural India by Nabard provides a rather interesting tale of contrasts in the eastern state. Though the average household income in Odisha may be one of the lowest in the country, the savings tendency of the state’s rural population is notably high.

The report says that while over 70 per cent of rural households in 11 states saved money during 2021-22, the figure in Odisha was 73 per cent. Though farm families in the state earned barely a third of those in Punjab, Haryana and Kerala, lower consumption expenditure meant that households ended up with decent savings, with women leading the way.

On the other hand, the annual Periodic Labour Force Survey report for July 2023 to June 2024 revealed that more than half the regular wage-earning and salaried employees of the state does not enjoy social security benefits.

About 48 per cent of the salaried workforce does not have written contracts and 43 per cent is not eligible for paid leave. Agriculture and allied sectors employ 46 per cent of Odisha’s workforce, while industry comes next with 28.4 per cent, followed by services at 24.7 per cent. And it’s in the non-agriculture sectors where the social safety net for workers is next to nil - and this must change.

Experts say the growing informalisation of the formal sectors’ workforce may have led to the absence of institutional social security nets. However individual households are increasingly capable of using the available financial products as a shield for their tougher days.

The experts’ explanation for higher savings in rural Odisha includes families - especially the women - prompted to save for rainy days against rising cost of living, as well as against vulnerability to natural disasters in the coastal state.

They are also reacting to the limited social security cover available to the non-urban population. All this calls for a fresh assessment of the state government’s welfare schemes. Instead of allowing the bouquet of schemes to work separately, the government must use its beneficiary database and plan a comprehensive social safety net that covers both the formal as well as the informal workforce.

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