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India's informal economy accounts for more than half the country's GDP but is characterised by low levels of skills, and considerable barriers to skills development for workers. The Government of India has implemented ambitious policy initiatives for upskilling, designed to catalyse 'formalisation' of the economy, and improve productivity. However, evidence on skills development remains weak. Drawing on systematic review methodologies, this article reviews and synthesises the literature on the practical barriers to upskilling. It finds that access to, and quality of, training (especially for women) are serious limitations, while skills are often under-utilised in the absence of supportive labour market and wider business environment conditions. Training is often insufficiently linked to labour market and learner needs, and the capacity of the training system is limited. Government should increase investment in training for the informal sector, and consider strengthening incentives for training providers to focus on improving training quality and relevance. [ABSTRACT FROM AUTHOR]

In Indian manufacturing, which accounts for only 12.2% of the country's workforce, a few technologically advanced sectors coexist with a vast informal sector. The growth of Indian manufacturing is characterized by ‘joblessness’, and during the post-1991 years, by large yearly and industry-wise variations. While a few capital- and skill-intensive industries recorded fast rates of growth of value added, employment generation occurred largely in the unorganized sector, mainly in export-oriented industries such as garments and textiles. The frequently cited argument that the major barrier to manufacturing-employment growth in India is the ‘rigidity’ in the country's labour regulations rests on very thin empirical evidence. With the rising share of contract workers even within the organized segments of manufacturing since the 1990s, the very argument that India's labour market is rigid is questionable. Power shortages, insufficient availability of credit and the volatility in exchange rates and raw material prices are some of the important factors that constrained the growth of Indian manufacturing, especially the small-scale sector. [ABSTRACT FROM PUBLISHER]

The analysis of public works programmes using the theory of real options argues that the effectiveness of these programmes can be studied by examining the switches the workers make between public works and other labour market activities. The wage rate between these two options is the focus of the analysis under the theory of real options. This paper critically examines the applicability of the econometric methods of the theory of real options by studying the same public works programmes through a local management perspective using a case-study approach. Local elites enjoy 'informal ownership' of public works programmes, and the rights of the poor are therefore shrouded in micro-politics. Besides, for a large number of the poorest people who are trapped in a vicious cycle of debt and seasonal migration, rights and options are foregone. The power of the local elites is discounted heavily in the approach of theory of real options. Relying on such outcome variables—which are manufactured by the local elites—can mislead policy decisions. [ABSTRACT FROM AUTHOR]