It’s old news that the pandemic has affected the lives and livelihood of millions. The worst affected seems to be the lower income class. The day-wage structure revolving around labour intensive industries has taken a big setback.
With big industries reeling under the stress of lockdowns, the Indian GDP will suffer in the foreseeable future. Not aware of the technicalities of GDP, the working lower middle class and the lower income tier is struggling to make ends meet in a bleak future.
A tumultuous GDP and a nation on the move
Migrant labourers have been hit the hardest with daily work drying up and scores returning to their native states. As per reports about 100 million migrant workers directly contribute to 10% of the India GDP – a major share yet underestimated.
A report generated by the Centre for Monitoring Indian Economy (CMIE) throws a bleak picture. In the initial lockdown phase of April, an estimated 122 million people lost their jobs. It doesn’t come as a surprise that most of these job losses are to the small traders and wage labourers.
The national Government to aid migrant labourers, announced multiple financial packages and schemes. States have also dug in to their coffeurs to provide fiscal and support in kind. It has been unclear how the monetary support will benefit the end benefactors but that’s not the end of the peril. The larger question remains – what happens when the money dries up?
What could be done to convert the adversity into an opportunity. How could we create a long term solution – What could be a long term big impact strategy to create more employment possibilities.
MASS solution to a MASS problem – adding jobs to the market
A large scale livelihood problem needs a large scale solution. The first periphery is the addition of new jobs in the market. While the consensus is that fast growing startups will form the pillars of the economy in the near future – the truth is wayward.
According to the Global Alliance for Mass Entrepreneurship (GAME) study, the new startups are not adding as many jobs in the market. Not at least at par with their market valuation. Better strategies to employ Indians on a local level is thus the best way forward.
The RISE of the Mass Entrepreneurs – the need of the hour
In generic terms, Mass Entrepreneurship refers to the millions of ordinary local businesses that use local inputs and serve local needs in every community – thereby impacting the local economy. They are the people backbone companies (such as bakers, small agri-business, and craft villages) that are never going to see a stock exchange, but who typically hire or increase the income of 5 to 20 people. This is the kind of multiple needed to employ the millions of youths
joining our workforce every year.
For India to be self sustainable – local entrepreneurs are needed to support local income generation. This is particularly true for small towns and villages where the traditional means of income has taken a severe hit. With migrant labours returning in force – the unemployed problems have only but multiplied. The solution lies in converting the ‘job seekers’ into “mass entrepreneurs”.
To make Mass Entrepreneurship truly flourish what is needed is a framework, a comprehensive strategic policy intervention, financial and business development tools to facilitate handholding and support systems for creating mass entrepreneurs, and accelerate the growth of small and medium enterprises.
What India needs is a policy framework which provides entrepreneurs with integrated financial, business development and access to market services, tailored to the sectors with high economic and employment potential.
Policies and programs supporting Mass Entrepreneurship can lead to positive change. In China, policies were implemented to promote innovation, intellectual property enforcement, and fund raising – leading to 13 million new formally registered businesses between 2014 and 2017. Start-ups bring dynamism and some new platform businesses can even – like in China’s Alibaba-enabled Taobao villages supplying the world – make it easier for Mass Entrepreneurship to flourish.
To put into statistics India has 11% ME as compared to 35–40% in global average – the potential is huge.
Mass Entrepreneurship is the only way we could fundamentally create a self sustainable rural Economy and create livelihoods for millions.The essential linkage to market services and financial seeding is required for creating a pool of mass entrepreneurs.
Mass Entrepreneurship with the potential to revive economy
India has a great opportunity to make the youth of India make sustainable livelihood. Mass Entrepreneurship could act as driver for mass employment. It could be a game changer.
The Skill India mission has given India an unique opportunity. It has been able to create a pool of skilled candidates whose skills range from beauty technician to mobile technician – it is a diverse skill pool with potential to generate income through service.Skill centers have been earmarked across the country to churn out candidates with much needed skill sets. Now these skilled candidates have an opportunity to employ themselves in their native places and be an entrepreneur.
Mass entrepreneurship would also help in creating less pressures on our urban cities where available resources and infrastructure is cracking due to excessive migration. Economic activity and growth would get spread across the towns and villages – where it is needed most.
There could be multiple formats of Mass Entrepreneurs – For example in a small town or village one entrepreneur can easily open a mobile repairing shop or a beauty parlour with minimal seed money. Another focus should be to create a framework on business which have local strengths, We have few success stories like Moradabad for brass products, hosiery production at Ludhiana we could create clusters like Filigree Silver products at Cuttack, woolen garments at Kashmir.
Mentoring Mass Entrepreneurs and Market Linkage – the missing link
One of the main aspects of bridging the gap between the market and the potential entrepreneurs is hand holding. Consultation services can play a vital role in this by providing the mass entrepreneurs with necessary marker knowledge and even guide them to acquire seed money for their business.
That essential market linkage is what will drive entrepreneur generation in the coming future and is highly needed.
Moving beyond villages and embracing urban entrepreneurship
Entrepreneurship can still be fostered in urban places – even though one might think of it as a saturated market. There is scope for urban entrepreneurship especially in the service delivery sector and manufacturing sector.
The organized large scale manufacturing sector is primarily moving to rural settings to benefit from the lack of population (complying to health norms befitted to large scale productions) and disposable lands. The informal manufacturing units though are rapidly urbanising themselves to take benefit from the infrastructure which cuts their own setup cost.
Ultimately the future jobs of India youth would be provided by locally-anchored mass entrepreneurs – let’s give them the attention they deserve.About the AuthorPrashant Pachisia
CEO, 2COMS Group
Prashant looks after business innovations and is the main think tank for 2COMS Group.
Prashant is the CEO & founder of 2COMS Group. Prashant graduated from St. Xavier’s College with Bachelors in Commerce. In 1993, set up his own venture Educom Software, a franchisee centre of Aptech Limited. Later in 1995, formed 2nd firm, Futurecom, providing networking and other hardware related solutions. Finally in 1999 formed 2COMS Group