Employment Change in Occupations in Urban India: Implications for Wage Inequality

This article analyses employment and wage change patterns in India for a period spanning almost three decades, 1983 to 2011. Using data from the National Sample Survey Organisation, this study finds evidence of job polarisation (employment growth in lowand high-skill jobs, and reduction in the middle) in urban India during the 1990s and 2000s. However, the 1980s experienced an employment upgrading. The wage change patterns are almost consistent with the employment change patterns. A reduction in employment share in routine task intensive occupations was found which is consistent with the job polarisation literature. It is argued that the reduction in employment share in the middle skill routine occupations is a result of mechanisation and technological upgradation within the Indian industry. On the other hand, increase in employment in both low-skill and high-skill occupations is more of a result of growing self-employment in informal sector in urban India.