National Sample Survey 1994 -1995 (51st round) - Schedule 2.2 - Unorganised Manufacturing Sector in India
Informal Sector Survey [hh/iss]
The National Sample Survey (NSS), set up by the Government of India in 1950 to collect socio-economic data employing scientific sampling methods started its fifty-first round from 1st July, 1994. The survey continued up to 30th June 1995. Following the first Economic Census 1977, small establishments and enterprises not employing any hired worker [and henceforth called 'own account enterprises' (OAEs)] engaged in manufacturing and repairing activities were surveyed on sample basis in the thirty-third round of NSS during 1978-79. As a follow-up to the second Economic Census 1980, own account enterprises and Nondirectory Establishments engaged in manufacturing and repairing activities (i.e., OAMEs and NDMEs respectively) were surveyed in the fortieth and forty-fifth rounds of NSS during July 1984-June 1985 and July 1989-June 1990 respectively. The Directory Manufacturing Establishments (DMEs) were surveyed during October 1984-September 1985 and October 1989 to September 1990 respectively by a group of special staff (Assistant Superintendents only) of the Field Operations Division (FOD) of the NSSO under the technical direction of the CSO. As a follow-up to the third Economic Census 1990, the first integrated survey on unorganized manufacturing and repairing enterprises covering OAMEs, NDMEs and DMEs was undertaken during the fifty-first round of NSS (July 1994-June 1995).
The unorganised sector holds the key to understanding the economic situation in developing countries such as India. The importance of this sector had been realised by the Indian planners and policy makers in the 1950s. The need for statistical information about it was also widely recognised. The household-based nonagricultural activities had been covered by the National Sample Survey Organisation (NSSO) since 1950. In all the surveys, the relevant activities of a sample of households were covered irrespective of their scale of operations except the manufacturing activities carried out by the enterprises registered under the Factories Act, 1948.
In the early 1970s, at the time of formulation of the Fifth Five Year Plan, the Planning Commission was concerned about the employment and earnings of the self employed in non-agricultural activities. The NSSO therefore devoted the 29th round (1974-75) mainly to a survey of selfemployed own account workers engaged in non-agricultural enterprises in different sectors in rural as well as urban areas. The household enterprises covered by the survey were those operated by own account workers(i.e., those not employing any hired worker) and those household enterprises which did not usually employ more than 5 hired workers. However, units engaged in manufacturing and repairing services registered under Factories Act were excluded from the survey.
The household approach of identifying the units excluded the nonhousehold based units in the unorganised sector. Further, a review of the surveys indicated that a better sampling frame was necessary to generate reasonably useful statistics on unorganised sector. The need for identifying areas with a concentration of enterprises was, therefore, felt for ensuring an efficient sampling for the future surveys. A country-wide economic census, the first of its kind, was undertaken in 1977 under the auspices of the Central Statistical Organisation (CSO) to provide a good frame and background information needed for formulating an efficient sampling design.
The scope of the 1977 economic census was limited to non-agricultural enterprises employing at least one hired worker on a fairly regular basis. The enterprises employing at least one hired worker are called 'establishments'. Following this census, small establishments and enterprises not employing any hired worker on a fairly regular basis (these units are called own account enterprises (OAEs)) engaged in manufacturing and repairing activities were surveyed in 33rd round of NSS during 1978-79.
The second economic census was undertaken in 1980 along with the houselisting operations of the 1981 population census. The scope and coverage of the second economic census was enlarged to include the own account enterprises (OAEs) engaged in activities other than crop production and plantation. The establishments were divided into two categories as (i) Directory Establishments (DEs) and (ii) Non-Directory Establishments (NDEs), the difference being that the former employed a total of six or more workers, while the latter employed a total of five or less workers. Thus, in all, three types of enterprises were formed, viz., (i) OAEs, (ii) NDEs and (iii) DEs in the second economic census. As a follow-up to the second economic census, OAEs and NDEs engaged in manufacturing and repairing activities (i.e., OAMEs and NDMEs respectively) were surveyed in the 40th and 45th rounds of NSS during July 1984-June 1985 and July 1989-June 1990 respectively. The Directory Manufacturing Establishments (DMEs) were surveyed during October 1984-September 1985 and October 1989 to September 1990 by field staff of NSSO under the technical guidance of CSO.
A third economic census was conducted in 1990 along with the house listing operations of the 1991 population census. As a follow-up to the third economic census, the first integrated survey on unorganised manufacture covering own account manufacturing and repairing enterprises(OAMEs), Non-Directory manufacturing and repairing establishments (NDMEs) and Directory manufacturing and repairing establishments (DMEs) were undertaken during the 51st round (July 1994-June 1995) under the technical guidance of NSSO.
In the 51st round all manufacturing and repairing enterprises covered by the two-digit codes (called divisions) 20 to 39 and 97 under the revised National Industrial Classification of different economic activities, 1987 (henceforth in this report termed NIC, 1987) were considered for survey purpose. Hereafter, the term enterprises will mean manufacturing and repairing enterprises or establishments as the case may be.
Enterprises which were registered under Sections 2m(i) and 2m(ii) of the Factories Act, 1948 (i.e., enterprises employing 10 or more workers using power and those employing 20 or more workers without power) and bidi and cigar manufacturing enterprises registered under bidi and cigar workers (condition of employment) Act, 1966 were not covered in this survey. These enterprises, not covered in the 51st round survey, were covered in the Annual Survey of Industries undertaken by CSO.
The 51st round survey of unorganised manufacturing and repairing enterprises covered, in the central sample, the whole of the Indian Union except (i) Ladakh, Kargil, Anantnag, Pulwara, Srinagar, Badgam, Baramulla and Kupwara districts of Jammu & Kashmir, (ii) 768 interior villages of Nagaland (out of a total of 1232 villages) situated beyond five kilometers of the bus route and (iii) 195 villages of Andaman & Nicobar Islands (out of a total of 549 villages) which remained inaccessible throughout the year. Thus the corresponding State/U.T. level estimates and the All-India results presented in this report are based on the areas other than those left out from the survey coverage.
In the case of central sample, 8214 villages were surveyed in rural areas and 5258 enumeration blocks/Urban-frame survey blocks were surveyed in urban areas (villages/urban blocks with no manufacturing unit surveyed, in spite of having some enterprises in these villages/urban blocks, are excluded from this count). Detailed information was collected from each of the selected enterprises of the sample villages and blocks.
Kind of Data
Sample survey data [ssd]
Unit of Analysis
The survey covers the following themes:
1. Identification of sample enterprise/establishment
3. Details of operation and some background information on the enterprise including :
- Industrial activity description - type of ownership, age of enterprise, source of energy used and whether accounts are available
- Characteristics of proprietor including - household size, social group and sources of household income
4. Inventory of fixed assets owned and hired during the reference year
5. Inventory of stock/working capital for the reference year
6. Outstanding loan including interest
7. Employment and emoluments during the reference period
8.1. Raw materials and fuels consumed (including homegrown) during the reference period
8.2. Other inputs consumed during the reference period
9. Products and by products manufactured (including products consumed at home) during the reference period
10. Calculation of gross value added for the reference period
NSS 51st round survey covered the whole of the Indian Union excepting (i) Ladakh, Kargil, Anantanag, Pulwama, Srinagar, Badgam, Baramula and Kupwara districts of Jammu & Kashmir, (ii) interior villages of Nagaland situated beyond 5 Kms. of a bus route and (iii) villages of Andaman & Nicobar Islands remaining inaccessible throughout the year (the areas left out from the survey coverage had a share of about 0.62 per cent in the total population of the country). Thus the corresponding state/u.t. level estimates and the all-India results presented in the report are based on the areas other than those left out from the survey coverage.
All manufacturing and repairing enterprises covered by the two-digit codes (called divisions) 20 to 39 and 97 under the revised National Industrial Classification of different economic activities, 1987 were considered for survey purpose.
Producers and sponsors
National Sample Survey Organisation
Department of Statistics, Government of India
Government of India
In 51st round the total number of villages and blocks surveyed at the national level was 13690 for the central sample. These samples were classified into two categories as "Sample-1" and "Sample-2" in both rural and urban areas. The samples of sample-1 were distributed over the four sub-rounds in equal numbers, whereas for sample-2, there was no sub-round restriction. The survey period of 51st round was July 1994 - June 1995.
A stratified two-stage sampling design was adopted. The first stage units (FSUs) were the villages (panchayat wards in Kerala) in rural areas and urban blocks in urban areas. In particular, for the urban areas, enumeration blocks (EBs) were taken as FSUs where 1990 economic census (EC -90) frame was used and NSSO urban frame survey (UFS) blocks otherwise. The second stage units (SSUs) were the manufacturing and repairing enterprises in the selected FSUs. 2 Allocation of sample FSUs between rural and urban areas State/UT level total sample size (i.e.,total number of villages and blocks to be surveyed) was allocated between rural and urban areas in proportion to population as per 1991 population census with double weightage to the urban areas. The total sample size for both rural and urban areas, as mentioned above, was equally divided into two sample types, namely Sample-1 and Sample-2.
Sampling frame: For rural areas, list of villages showing number of OAMEs, NDMEs and DMEs as per 1990 economic census was used as the sampling frame for selection of FSUs, for both the sample types, in different States/UTs except Jammu & Kashmir(J & K), Arunachal Pradesh and Nicobar district of Andaman & Nicobar Islands. For the state of Kerala, however, list of Panchayat wards, giving count of OAMEs, NDMEs and DMEs at panchayat level as per 1990 economic census, was used. For Jammu & Kashmir, list of 1981 population census villages, while for Nicobar district of Andaman & Nicobar Islands, list of 1991 population census villages was used. In Arunachal Pradesh, list of villages as per 1991 population census was used as the sampling frame for selection of sample "nucleus" villages around which clusters were formed. In urban areas, list of EBs as per 1990 economic census constituted the sampling frame for Class 1 towns (except in Jammu & Kashmir) of sample type 1 and for all towns (except J & K) of sample type 2. The list of UFS blocks was used as the sampling frame for all towns of Jammu & Kashmir and other than class 1 towns of the other states for sample type 1, and for all towns of Jammu & Kashmir only in the case of sample type 2.
Stratification: In rural areas, for samples of type 1 each district generally formed a separate stratum. However for the state of Gujarat, where NSS regions cut across some district boundaries, parts (viz., groups of taluks) of each such district belonging to different NSS regions formed separate strata. If any district (or part thereof falling in an NSS region in case of Gujarat) had a smaller number of manufacturing enterprises, it was clubbed with the neighbouring district within the same NSS region to form a separate stratum to ensure a minimum allocation of 8 villages at the stratum level. Each district as a whole was always taken as a separate stratum for samples of type 2. In the case of urban areas for samples of type 1, strata were formed within each NSS region by grouping cities/towns according to the population of the cities/towns viz., p<=0.5, 0.5<=p<1, 1<=p<5, 5<=p<10 and p>=10 (where p stands for 1991 census population of the town in lakhs). Each city with population 10 lakhs or more formed a separate stratum. For samples of type 2, strata were formed within each district by grouping cities/towns according to the population, viz., p<1, 1<=p<5, 5<=p<10 and each city with p>=10. However, no grouping of towns was made for the states of Assam, Haryana and Pondicherry.
Sub-stratification: For rural samples of type 1, where 1990 EC frame was used, the FSUs in a stratum were grouped into 3 sub-strata as detailed below.
(a) sub-stratum 1 consisting of FSUs having at least one DME;
(b) sub-stratum 2 consisting of those of the remaining FSUs which had at least one NDME; and
(c) sub-stratum 3 consisting of all the residual FSUs in the stratum.
There was no sub-stratification at the stratum level for the States/UTs where population census frame was used for selection of FSUs. For these States/UTs, all FSUs in a stratum were identified with substratum 3 for operational convenience. In urban areas for samples of type 1 three sub-strata were formed in class 1 towns (except for J & K) as follows :-
(i) sub-stratum 1 consisting of EBs having at least one DME;
(ii) sub-stratum 2 consisting of those of the remaining EBs in the stratum having at least one NDME; and
(iii)sub-stratum 3 consisting of all the remaining FSUs in the stratum.
For other towns, includiing all towns of Jammu & Kashmir, two sub-strata were formed, where sub-stratum 1 consisted of all UFS blocks identified as Industrial area (IA) and the remaining UFS blocks in the stratum constituted sub-stratum 2. For samples of type 2 stratum level substratification was not done in both rural and urban areas.
Allocation of sample FSUs among strata and sub-strata: The total rural samples of type 1 for a State/UT were allocated to the constituent strata/sub-strata in proportion to weighted sum of the number of manufacturing enterprises of different types, as available from EC 1990, the weights being 16, 4 & 1 for DME, NDME and OAME respectively. A minimum allocation of one sample was ensured at sub-stratum level and efforts were made to make the stratum level allocations as multiples of 4 to allocate equal number of samples in each of the four sub-rounds. However, the total rural samples of type 2 for a State/UT were allocated to the constituent strata in proportion to their total number of manufacturing enterprises (weights being equal for DME, NDME & OAME) as available from EC 1990. A minimum allocation of 2 FSUs was done for each stratum. In urban areas, for samples of type 1, allocated sample size of FSUs for a State/UT was further allocated to the constituent strata in proportion to weighted sum of the manufacturing enterprises (in proportion to population for J & K) as was done in the rural areas. For class 1 towns (except for J & K), the stratum level FSUs were further allocated to three sub-strata again in proportion to weighted sum of the number of manufacturing enterprises in the ratio 16 : 4 : 1. The allocation at the substratum level had been kept at a minimum of 2 FSUs. For other towns (including all towns of J & K) the UFS blocks of substratum 1 were completely selected for survey, subject to a maximum of half of the stratum allocation of samples of a particular type; and the rest to sub-stratum 2. The total urban samples of type 2 for a State/UT (except for J & K) was allocated to the constituent strata in proportion to their total number of manufacturing enterprises. For the state of Jammu & Kashmir stratum level allocation was done in proportion to 1981 census population.
Selection of first stage units (FSUs): The sample FSUs for rural samples of type 1, at stratum x sub-stratum level, were selected with probability proportioned to size (PPS), size being the number of enterprises/population as detailed below :-
(A) For States/UT where 1990 EC frame was used, size was number of DMEs, NDMEs and OAMEs in the FSU belonging to sub-stratum 1, 2 and 3 respectively.
(B) For other States/UTs viz., (i) Arunachal Pradesh, size = 1 for each FSU (ii) Jammu & Kashmir, size = population in the FSU as per 1981 census; (iii) Nicobar district of Andaman & Nicobar, size = population in the FSU as per 1991 census.
The stratum x sub-stratum level rural samples of type 2 were selected by PPS with replacement, size being the total number of manufacturing enterprises (i.e. total of DMEs, NDMEs and OAMEs) in the FSU for the States/UTs where 1990 EC frame was used and for other States/UTs where 1990 EC frame was not used size was same as in rural samples of type 1. In urban areas sample blocks of type 1 were selected from each sub-stratum of class 1 towns (except for J & K) with PPS with replacement taking number of DMEs, NDMEs and OAMEs in the FSU as size for sub-stratum 1, 2 & 3 respectively. For other towns (including all towns of J & K) the sample blocks from each sub-stratum were selected circular systematically with equal probability. Sample blocks of type 2 were selected with PPS with replacement, size being the total number of OAMEs, NDMEs and DMEs for all the Sates/UTs except J & K for which simple random sampling without replacement technique was followed for selection of sample blocks. Both in rural and urban areas, for samples of type 1, size of an FSU of substratum 3 was taken as 1 if there was no OAME or no information about number of enterprises due to incompleteness of the frame. The FSUs of sample type 2 having no manufacturing enterprises or no information about them were also considered as FSUs of size 1.
Hamlet-group/sub-block formation : Large villages/blocks having approximate present (at the time of survey) population 1200 or more (600 or more for rural areas of Himachal Pradesh, Sikkim and Poonch, Rajouri, Udhampur & Doda districts of J & K) and/or approximate present number of non-agricultural enterprises more than 200 were divided into a suitable number (say,D) of hamlet-groups (h.g.)/sub-blocks (s.b.). The survey was conducted in two h.g.s/s.b.s selected from D hamlet-groups/sub-blocks in the following manner. The h.g./s.b. having maximum number of manufacturing and repairing enterprises (OAMEs, NDMEs and DMEs taken together) was always selected and allotted a serial number '0'. From the remaining h.g.s/s.b.s, one more h.g./s.b. was selected at random and allotted a serial number '1'. In case there was not even a single manufacturing or repairing enterprise in a large village/block, the h.g./s.b. having maximum population was selected and allotted serial number '0' and from the remaining h.g.s/s.b.s another was selected at random and allotted serial number '1'. In the case of a small village/block not requiring h.g./s.b. formation, the whole village/block was treated as a h.g./s.b. bearing serial number '0'. The minimum number of h.g./s.b. formed in large villages/blocks was 4.
Sampling of enterprises: All OAMEs, NDMEs and DMEs which operated for at least 30 days (15 days in case of seasonal enterprises) during the last 365 days were considered for sampling. The enterprises registered under Factories Act, 1948 and Bidi and Cigar workers (condition of Employment) Act, 1966 were not considered for survey purpose. For FSUs of sample type 2, all the eligible manufacturing and repairing enterpriseslisted in the village / block /h.g. /s.b. were taken up for detailed survey. However, for samples of type-1, a maximum of 16 enterprises were selected for detailed enquiry.
All eligible manufacturing and repairing enterprises of different types were separately arranged by broad industry division (2-digit) codes as per NIC, 1987. This grouping of enterprises by NIC codes was done independently for each of the two selected hamlet-groups/sub-blocks for FSUs requiring hamlet-group/sub-block formation. The required number of sample enterprises were then selected circular systematically from the rearranged frame, separately for OAMEs, NDMEs and DMEs.
8214 villages were surveyed in the rural areas and 5258 enumeration blocks/UFS blocks were surveyed in the urban areas. From these villages and urban blocks detailed data were collected from a total of more than 1.9 lakhs sample manufacturing and repairing enterprises, of which 1.2 lakhs(i.e., 63%) were from villages and 0.7 lakh from urban blocks. Out of the total number of sampled enterprises, a little less than 1.5 lakhs (about 76%) were Own Account Manufacturing Enterprises (OAMEs), about 0.3 lakh (i.e., 16%) Non-Directory Manufacturing Establishments (NDMEs) and the rest Directory Manufacturing Establishment(DMEs).
Out of a total of about 1.2 lakhs rural sample enterprises, 83% were OAMEs, about 10% NDMEs and the rest DMEs. In the case of urban samples 64% were OAMEs, 25% NDMEs and the remaining DMEs. Statements 1R & 1U give state-wise number of sample enterprises by enterprise type separately for rural and urban areas.
Dates of Data Collection
Data Collection Mode
Data Collection Notes
Reference period: In block 3 as well as in other subsequent blocks of schedule 2.2 some data was recorded as on the date of survey (e.g., bl.3, items 2,3,4,6 & 7) while others pertained to a reference period of one year and/or a reference period of one month. Where enterprises/establishments maintained proper books of accounts it was easy to collect information for the accounting year and hence in all such cases the reference year for the fifty-first round survey would be the previous accounting year. However, if for any enterprise, accounts were not maintained regularly and not up-to-date, the books of accounts would not be able to give information for the latest year of accounting but for some past year which would not be useful. Hence it was decided to restrict the choice of reference year for an enterprise to that accounting year (i) which ends on a date lying within the period of 365 days prior to the date of visit by the investigator to the sample enterprise and (ii) for which the accounts would have been completed and were usable. It should be noted that if condition (ii) was not fulfilled and accounts were complete for an earlier accounting year [i.e., an accounting year not fulfilling condition (i)] that accounting year would not be chosen as the reference year. For the accounting year of the enterprise to be chosen as the reference year, both conditions (i) and (ii) had to be fulfilled. Where the accounting year was chosen as the reference year, the reference month would mean the last or concluding month of that accounting year. For instance, if 'Ist October, 1993 to 30th September, 1994' was the accounting year of an enterprise (which is, say, visited in February, 1995) and accounts were found complete for that year, then Ist October, 1993 to 30th September, 1994 would be the reference year and the calendar month of September, 1994 would be the reference month. In all other cases where it was not possible to chose an accounting year as the reference year, the period of 365 days immediately preceding the date of visit would be treated as the reference year, while the 30 days immediately preceding the date of visit became the reference month. If the accounting year was different from 12 months, data would relate to the whole accounting year in all relevant blocks.
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National Sample Survey Organisation
Ministry of Statistics and Programme Implementation (MOSPI)
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