People As Resource

Hello students, welcome to today's economics lesson. I'm so happy to see you all here, ready to learn something new and important. Today, we are going to study Chapter 2 of your economics textbook, and the title is "People as Resource". Now, before we begin, let me ask you something. When you hear the word "resource", what comes to your mind? You might think of things like water, minerals, forests, or maybe money and machinery. But have you ever thought about people as a resource? That might sound strange at first, right? We usually think about population as a problem, something that creates pressure on resources. But in this chapter, we are going to learn how people can actually be an asset for our economy, just like land, factories, and money. So let's begin our journey and understand this fascinating concept together.

So students, let's start by understanding what exactly we mean by "people as a resource". The chapter tells us that population can be looked at as an asset for the economy rather than a liability. Now, what does that mean? It means that when we invest in people, when we make them more educated and healthy, they become a valuable resource for the country. This is called human capital. Think about it like this - when a country has more doctors, engineers, teachers, and skilled workers, it can produce more goods and services, and the country becomes wealthier. This is exactly what we mean by people being a resource.

Now, let me explain the difference between population and human capital. The chapter tells us that population becomes human capital when there is investment made in the form of education, training, and medical care. So simply having a large population doesn't make it a resource. It is only when we invest in making those people more capable, more skilled, and more healthy that they become human capital. The chapter gives us a very important definition - human capital is the stock of skill and productive knowledge embodied in people. This is a key concept, so let me say it again. Human capital refers to the skills, knowledge, and abilities that people have, which can be used to produce goods and services. And this human capital is created through investment in education, health, and training.

Now students, let me tell you how human resource is different from other resources like land and physical capital. The chapter emphasizes that human resource is superior to other resources in one very important way - human resource can make use of land and capital, but land and capital cannot become useful on their own. Think about it. A piece of land just sits there until people come and cultivate it. A machine just sits in a factory until workers operate it. But human beings can think, create, innovate, and make the best use of all other resources. This is what makes human capital so special and so important for any country's development.

Now, let's look at some real-life examples from the chapter to understand this better. The chapter gives us two very touching stories - the story of Sakal and the story of Vilas. Both these boys live in the same village called Semapur, but their lives are very different. Let's first understand Sakal's story.

Sakal was a twelve-year-old boy. His mother Sheela looked after domestic chores at home. His father Buta Chaudhary worked in agricultural fields. Sakal helped his mother with domestic work and looked after his younger brother and sister. Now, there was also his uncle Shyam who had passed the matriculation examination but was sitting idle at home because he had no job. This shows us that education without proper utilization can also lead to problems. But Sakal's parents were eager to educate him. They forced him to join the village school, and he soon started studying. He completed his higher secondary examination, and his father persuaded him to continue his studies. His father even raised a loan for Sakal to study a vocational course in computers. Sakal was meritorious and interested in studies. With great enthusiasm, he completed his computer course. After some time, he got a job in a private firm. He even designed a new kind of software that helped increase the sales of the firm. His boss acknowledged his services and rewarded him with a promotion. So students, you can see how an investment in education transformed Sakal's life and made him a productive member of the economy.

Now let's look at Vilas's story. Vilas was an eleven-year-old boy living in the same village. His father Mahesh was a fisherman who passed away when Vilas was only two years old. His mother Geeta sold fish to earn money to feed the family. She bought fish from the landowner's pond and sold it in the nearby mandi. She could earn only Rs 150 a day by selling fish. Vilas became a patient of arthritis. His mother could not afford to take him to the doctor. He could not go to school either because of his health problems. He was not interested in studies. He helped his mother in cooking and looked after his younger brother Mohan. After some time, his mother fell sick, and there was no one to look after her. There was no one in the family to support them. Vilas was forced to sell fish in the same village, and he earned a meagre income like his mother. So students, you can see the stark difference between the two friends. Sakal got an education, got a good job, and improved his life. Vilas, due to lack of education and health facilities, continued with the same low-paying work as his mother.

Now, let's answer the questions given in the chapter. The first question asks - looking at the photograph, can you explain how a doctor, teacher, engineer, and a tailor are an asset to the economy? Students, these professionals are assets because they contribute to the production of goods and services in the economy. A doctor provides healthcare services, a teacher educates future workers, an engineer designs and builds infrastructure, and a tailor produces clothing. All of them add value to the national income and help the economy grow.

The second question asks - do you notice any difference between the two friends? What are those? Yes, there are many differences. Sakal went to school and received education, while Vilas did not. Sakal was physically strong and healthy, while Vilas suffered from arthritis. Sakal acquired a degree in computer programming and got a good job, while Vilas continued selling fish like his mother. Sakal earned a good salary and could improve his standard of living, while Vilas earned a meagre income. These differences show how education and health can change a person's life and make them a productive resource for the economy.

Now students, let's understand what happened in Sakal's case. Several years of education added to the quality of his labour. This enhanced his total productivity. Total productivity adds to the growth of the economy. This in turn pays an individual through salary or in some other form. In Vilas's case, there could not be any education or health care in the early part of his life. He spends his life selling fish like his mother. Henceforth, he draws the same salary of an unskilled labourer as his mother. This is a very important point to understand. Investment in human resource through education and medical care can give high rates of return in the future. This investment on people is the same as investment in land and capital. Just as investing in a factory yields returns, investing in education and health yields returns in the form of higher productivity and higher incomes.

The chapter also talks about a virtuous cycle and a vicious cycle. Educated parents invest more heavily on the education of their child because they have realized the importance of education for themselves. They are also conscious of proper nutrition and hygiene. They accordingly look after their children's needs for education at school and good health. A virtuous cycle is created in this case. In contrast, a disadvantaged parent, who is uneducated and lacking in hygiene, may keep their children in a similarly disadvantaged state, creating a vicious cycle. This is why it's so important to break the cycle of poverty through education and healthcare.

Now, let's look at the example of Japan given in the chapter. Countries like Japan have invested in human resource. They did not have any natural resource. These countries are developed and rich. They import the natural resource needed in their country. How did they become rich and developed? They have invested on people, especially in the field of education and health. These people have made efficient use of other resources like land and capital. Efficiency and the technology evolved by people have made these countries rich and developed. This is a great example for us to understand how human capital can compensate for the lack of natural resources.

Now students, let's move on to understand the economic activities by men and women. The chapter tells us that various activities have been classified into three main sectors - primary, secondary, and tertiary. Let me explain each one.

The primary sector includes agriculture, forestry, animal husbandry, fishing, poultry farming, mining, and quarrying. These are activities that involve extraction of natural resources directly from the earth. For example, farming, fishing, and mining are all part of the primary sector.

The secondary sector includes manufacturing. This is where raw materials from the primary sector are transformed into finished goods. For example, when wheat is turned into flour and bread, or when cotton is turned into cloth and clothes, that is the secondary sector.

The tertiary sector includes trade, transport, communication, banking, education, health, tourism, services, insurance, and so on. These are activities that provide services to people. When you go to a bank, or travel by bus, or study in a school, or visit a doctor, you are using services from the tertiary sector.

Now, the chapter also talks about economic activities and non-economic activities. Economic activities have two parts - market activities and non-market activities. Market activities involve remuneration to anyone who performs the activity, that is, activity performed for pay or profit. These include production of goods or services, including government service. Non-market activities are the production for self-consumption. These can be consumption and processing of primary product and own account production of fixed assets. Let me give you some examples from the chapter.

Vilas sells fish in the village market - this is a market activity because he is selling for profit. Vilas cooks food for his family - this is a non-market activity because it is for self-consumption. Sakal works in the private firm - this is a market activity because he receives salary. Sakal looks after his younger brother and sister - this is a non-market activity because it is not done for payment.

Now students, let's discuss the quality of population. The quality of population depends upon the literacy rate, health of a person indicated by life expectancy, and skill formation acquired by the people of the country. The quality of the population ultimately decides the growth rate of the country. Literate and healthy population are an asset. This is a very important point. A country with a high-quality population can grow faster because its people are more productive.

Let's first talk about education. The chapter tells us that education helps an individual to make better use of the economic opportunities available before him. Education and skill are the major determinants of the earning of any individual in the market. Sakal's education in the initial years of his life bore him fruits in the later years in terms of a good job and salary. Education opened new horizons for him, provided new aspirations, and developed values of life. Not only for individuals, education contributes towards the growth of society also. It enhances the productivity of individuals, which in turn contributes to the national income.

The chapter provides us with a graph showing the trends in literacy rates in post-independent India. Let me walk you through this graph. In 1951, the literacy rate for persons was about 18%, with males at about 27% and females at about 9%. In 1961, it was about 28% for persons, 40% for males, and 15% for females. In 1971, it was about 34% for persons, 46% for males, and 22% for females. In 1981, it was about 44% for persons, 56% for males, and 30% for females. In 1991, it was about 52% for persons, 64% for males, and 39% for females. In 2001, it was about 65% for persons, 75% for males, and 54% for females. In 2011, it was about 74% for persons, 82% for males, and 65% for females. And in 2017, it was about 77% for persons, 84% for males, and 70% for females. So students, you can see that literacy rates have increased significantly since 1951. This is a positive sign for our country's development.

Now let's answer the questions based on the graph. First, has the literacy rates of the population increased since 1951? Yes, definitely. From about 18% in 1951, it has increased to about 77% in 2017. Second, in which year does India have the highest literacy rates? Well, the graph shows data up to 2017, and the highest is in 2017 with 77% literacy. But since the data goes up to 2017, we can say that the literacy rate is highest in the most recent year shown. Third, why is literacy rate high among the males of India? This is due to several historical and social reasons. In many parts of India, especially in rural areas, boys are given preference over girls when it comes to education. There are also social norms that expect girls to help with household chores and marry early. Fourth, why are women less educated than men? For the same reasons I just mentioned - social norms, early marriage, preference for boys' education, and lack of safety for girls traveling to schools. Fifth, how would you calculate literacy rate in India? The literacy rate is calculated as the percentage of people aged 7 years and above who can read and write with understanding. It is calculated by dividing the number of literate people by the total population aged 7 years and above, and multiplying by 100. Sixth, what is your projection about India's literacy rate in 2025? Based on the trend, we can expect the literacy rate to continue increasing and possibly reach around 80% or more by 2025.

Now, the chapter also talks about various government initiatives for education. There is emphasis on elementary education with a special focus on girls. There is also establishment of pace setting schools like Navodaya Vidyalaya in each district. Vocational streams have been developed to equip large number of high school students with occupations related to knowledge and skills. The plan outlay on education has increased from Rs 151 crore in the first plan to Rs 99,300 crore in 2020-21. The expenditure on education as a percentage of GDP rose from 0.64% in 1951-52 to 3.1% in 2019-20. However, the chapter also mentions that there is a vast difference across different sections of the population. Literacy among males is nearly 16.1% higher than females, and it is about 14.2% higher in urban areas as compared to rural areas. As per 2011 census, literacy rates varied from 94% in Kerala to 62% in Bihar.

The chapter also mentions some challenges like poor quality of schooling and high dropout rates. But there are positive steps like Samagra Shiksha, which is a significant step for school education, and the mid-day meal scheme, which has been implemented to encourage attendance and retention of children and improve their nutritional status.

Now let's look at the table about higher education. The table shows the number of colleges, universities, students, and teachers from 1950-51 to 2022-23. In 1950-51, there were 750 colleges, 30 universities, 2,63,000 students, and 24,000 teachers. By 2020-21, there were 46,007 colleges, 1,074 universities, 39,434,256 students, and 14,82,890 teachers. This shows significant growth in higher education over the years.

Now let's answer the questions based on this table. First, is the increase in the number of colleges adequate to admit the increasing number of students? Well, while there has been a significant increase, the answer might be no because the number of students has increased much more rapidly than the number of colleges. Second, do you think we should have more number of universities? Yes, probably, to accommodate more students and provide better higher education. Third, what is the increase noticed among the teachers in the year 2015-16? Looking at the table, in 2015-16, there were 14,38,000 teachers. Fourth, what is your idea about future colleges and universities? We can expect them to continue growing to meet the demand for higher education.

Now students, let's talk about health. The chapter tells us that the health of a person helps him to realize his or her potential and the ability to fight illness. If a person is not healthy, he or she will not be able to maximize output to the overall growth of the organization. Health is an indispensable basis for realizing one's well-being. Improvement in the health status of the population has been the priority of the country.

The chapter provides some important statistics. Life expectancy has increased to over 67.2 years in 2021. Infant mortality rate has come down from 147 in 1951 to 28 in 2020. Crude birth rates have dropped to 20.0 in 2020, and death rates to 6 in 2020. These are positive indicators of improved health infrastructure.

The table shows data from 2014 to 2021 for sub-centres, primary health centres, community health centres, dispensaries and hospitals, beds, doctors, and nursing personnel. For example, in 2021, there were 1,94,349 SC/PHC/CHC, 36,068 dispensaries and hospitals, 8,49,206 beds, and 35,14,373 nursing personnel.

Now let's answer the questions based on this table. First, what is the percentage increase in dispensaries from 1951 to 2020? Well, the table doesn't give us 1951 data, but we can see that from 2014 to 2021, there has been an increase from 29,715 to 36,068 dispensaries and hospitals. Second, what is the percentage increase in doctors and nursing personnel from 1951 to 2020? Again, the table doesn't have 1951 data, but from 2014 to 2019, the number of doctors increased from 41,070 to 63,809. Third, do you think the increase in the number of doctors and nurses is adequate for India? If not, why? Probably not, because India still has a low doctor-patient ratio compared to international standards, and there is a huge disparity between urban and rural areas. Fourth, what other facilities would you like to provide in a hospital? We would like to have more specialized doctors, better equipment, more beds, and better emergency services. Fifth, discuss about the hospital you have visited. This is an activity for you to do - visit a nearby hospital and observe the facilities. Sixth, can you draw a graph using this table? Yes, you can draw a line graph or bar graph to show the increase in health infrastructure over the years.

Now students, let's move on to understand unemployment. The chapter asks us a question - Sakal's mother Sheela looked after the domestic chores, children, and helped her husband in the field. Sakal's brother Jeetu and sister Seetu spend their time playing and roaming. Can you call Sheela or Jeetu or Seetu unemployed? If not, why?

The answer is no, they cannot be called unemployed. Let me explain why. Unemployment is said to exist when people who are willing to work at the going wages cannot find jobs. Sheela is not interested in working outside her domestic domain. Jeetu and Seetu are too small to be counted in the workforce population. Neither Jeetu, Seetu, nor Sheela can be counted as unemployed. The workforce population includes people from 15 years to 59 years. Sakal's brother and sister do not fall within this age group, so they cannot be called unemployed. Sakal's mother works for the family. She is not willing to work outside her domestic domain for payment. She too cannot be called unemployed.

Now, let's understand the types of unemployment in India. In case of India, we have unemployment in rural and urban areas. However, the nature of unemployment differs in rural and urban areas. In rural areas, there is seasonal and disguised unemployment. In urban areas, there is mostly educated unemployment.

Seasonal unemployment happens when people are not able to find jobs during some months of the year. People dependent upon agriculture usually face this kind of problem. There are certain busy seasons when sowing, harvesting, weeding, and threshing is done. Certain months do not provide much work to the people dependent on agriculture. For example, after the harvest is done, there may be no work for several months until the next planting season.

Disguised unemployment is when people appear to be employed but are not really needed. This usually happens among family members engaged in agricultural activity. The work requires the service of five people but engages eight people. Three people are extra. These three people also work in the same plot as the others. The contribution made by the three extra people does not add to the contribution made by the five people. If three people are removed, the productivity of the field will not decline. The field requires the service of five people, and the three extra people are disguised unemployed.

In urban areas, educated unemployment has become a common phenomenon. Many youth with matriculation, graduation, and post-graduation degrees are not able to find jobs. A study showed that unemployment of graduate and post-graduate has increased faster than among matriculates. A paradoxical manpower situation is witnessed as surplus of manpower in certain categories coexists with shortage of manpower in others. There is unemployment among technically qualified persons on one hand, while there is a dearth of technical skills required for economic growth.

Now, let's understand why unemployment is harmful. Unemployment leads to wastage of manpower resource. People who are an asset for the economy turn into a liability. There is a feeling of hopelessness and despair among the youth. People do not have enough money to support their family. Inability of educated people who are willing to work to find gainful employment implies a great social waste. Unemployment tends to increase economic overload. The dependence of the unemployed on the working population increases. The quality of life of an individual as well as of society is adversely affected. When a family has to live on a bare subsistence level, there is a general decline in its health status and rising withdrawal from the school system. Hence, unemployment has a detrimental impact on the overall growth of an economy.

Now, let's look at the story of a village given in the chapter. There was a village inhabited by several families. Each family produced enough to feed its members. Each family met its needs by the members making their own clothes and teaching their own children. One of the families decided to send one of its sons to an agriculture college. The boy got his admission in the nearby college of agriculture. After some time, he became qualified in agro-engineering and came back to the village. He proved to be so creative that he could design an improved type of plough, which increased the yield of wheat. Thus, a new job of agro-engineer was created and filled in the village. The family in the village sold the surplus in a nearby village. They earned good profit, which they shared among themselves. Inspired by this success, all the families after some time held a meeting in the village. They all wanted to have a better future for their children too. They requested the panchayat to open a school in the village. They assured the panchayat that they would all send their children to school. The panchayat, with the help of government, opened a school. A teacher was recruited from a nearby town. All the children of this village started going to school. After some time, one of the families gave training to his daughter in tailoring. She started stitching clothes for all the families of the village because everyone now wanted to buy and wear well-tailored clothes. Thus, another new job, that of a tailor, was created. This had another positive effect. The time of the farmers in going far for buying clothes was saved. As the farmers spent more time in the field, the yield of the farms went up. This was the beginning of prosperity. The farmers had more than what they could consume. Now they could sell what they produced to others who came to their village markets. Over time, this village, which formally had no job opportunities in the beginning, had many like teacher, tailor, agro-engineer, and many more. This was the story of a simple village where the rising level of human capital enabled it to evolve into a place rich with complex and modern economic activities.

This story beautifully illustrates how investment in human capital can transform a village and create employment opportunities. When one person gets educated and comes back with new skills, it inspires others and leads to further development.

Now students, let's come to the exercises at the end of the chapter. I want you to understand each answer thoroughly, so let me go through them one by one.

Question 1: What do you understand by 'people as a resource'? The answer is that people as a resource is a way of referring to a country's working people in terms of their existing productive skills and abilities. Looking at the population from this productive aspect emphasizes its ability to contribute to the creation of the Gross National Product. Like other resources, population is also a resource - a human resource. This is the positive side of a large population that is often overlooked when we look only at the negative side, considering only the problems of providing the population with food, education, and access to health facilities.

Question 2: How is human resource different from other resources like land and physical capital? Human resource is different because human resource can make use of land and capital, but land and capital cannot become useful on their own. Human beings can think, create, innovate, and make the best use of all other resources. This makes human capital superior to other resources.

Question 3: What is the role of education in human capital formation? Education helps individuals to make better use of the economic opportunities available before them. Education and skill are the major determinants of the earning of any individual in the market. Education adds to the quality of labour and enhances total productivity, which adds to the growth of the economy. Education also opens new horizons, provides new aspirations, and develops values of life.

Question 4: What is the role of health in human capital formation? Health is an indispensable basis for realizing one's well-being. The health of a person helps him or her to realize their potential and the ability to fight illness. A healthy person can work more efficiently and contribute more to the economy. Health investment also yields returns in the form of higher productivity.

Question 5: What part does health play in the individual's working life? Health helps an individual to realize their potential and the ability to fight illness. A healthy person will not be able to maximize their output if they are ill. Health is essential for a person to work efficiently and contribute to the overall growth of the organization and the economy.

Question 6: What are the various activities undertaken in the primary sector, secondary sector, and tertiary sector? The primary sector includes agriculture, forestry, animal husbandry, fishing, poultry farming, mining, and quarrying. The secondary sector includes manufacturing. The tertiary sector includes trade, transport, communication, banking, education, health, tourism, services, insurance, and so on.

Question 7: What is the difference between economic activities and non-economic activities? Economic activities involve remuneration, that is, they are performed for pay or profit. These include production of goods or services. Non-economic activities are production for self-consumption, like cooking food for one's own family or doing household chores.

Question 8: Why are women employed in low paid work? A majority of women have meagre education and low skill formation. Women are paid low compared to men. Most women work where job security is not there. Various activities relating to legal protection are meagre. Employment in this sector is characterized by irregular and low income. In this sector, there is an absence of basic facilities like maternity leave, childcare, and other social security systems. However, women with high education and skill formation are paid at par with men.

Question 9: How will you explain the term unemployment? Unemployment is said to exist when people who are willing to work at the going wages cannot find jobs. It is a situation where people who want to work cannot find suitable employment opportunities.

Question 10: What is the difference between disguised unemployment and seasonal unemployment? Seasonal unemployment happens when people are not able to find jobs during some months of the year, typically in agriculture. Disguised unemployment is when people appear to be employed but are not really needed, and their removal would not affect productivity. It is commonly seen in family-run agricultural activities where more people work than actually required.

Question 11: Why is educated unemployed a peculiar problem of India? In India, educated unemployment has become a common phenomenon because many youth with matriculation, graduation, and post-graduation degrees are not able to find jobs. The unemployment of graduate and post-graduate has increased faster than among matriculates. There is a paradoxical situation where there is surplus of manpower in certain categories but shortage of manpower in others. There is unemployment among technically qualified persons on one hand, while there is a dearth of technical skills required for economic growth.

Question 12: In which field do you think India can build the maximum employment opportunity? India can build maximum employment opportunities in sectors like agriculture, manufacturing, services, information technology, biotechnology, and tourism. Given India's large population and diverse economy, the tertiary sector (services) has significant potential for employment generation. Also, with the right skills and training, sectors like IT and healthcare can absorb a lot of educated unemployment.

Question 13: Can you suggest some measures in the education system to mitigate the problem of the educated unemployed? Some measures could include making education more skill-oriented and job-oriented, providing vocational training, linking education with industry requirements, encouraging entrepreneurship, improving the quality of higher education, promoting distance education and online learning, and providing career counseling to students.

Question 14: Can you imagine some village which initially had no job opportunities but later came up with many? Yes, the story of a village given in the chapter is a perfect example. Initially, the villagers were self-sufficient but had no special job opportunities. Then one family sent their son to agriculture college. He became an agro-engineer and designed an improved plough. Then they opened a school, and later a girl was trained in tailoring. This created jobs like agro-engineer, teacher, and tailor. Over time, the village prospered with many job opportunities.

Question 15: Which capital would you consider the best - land, labour, physical capital, and human capital? Why? Human capital would be the best because human beings can make use of all other resources. Land and physical capital cannot become useful on their own. Human capital can think, create, innovate, and make the best use of land, labour, and physical capital. Investment in human capital yields high returns and is essential for the development of any country.

Now students, let me give you a brief activity from the chapter. You need to visit a nearby village or slum area and write down a case study of a boy or girl of your age facing the same condition as Vilas or Sakal. Try to observe the differences in their lives and understand how education and health can make a difference.

There's also another activity about categorizing various activities undertaken by people in your neighborhood into primary, secondary, and tertiary sectors, and determining whether they are economic or non-economic activities.

And there's an activity about visiting a hospital and noting down the number of beds, doctors, and nurses, as well as the number of hospitals and dispensaries in your locality.

Now students, let me summarize what we have learned in this chapter.

In this chapter, we learned that population can be an asset for the economy rather than a liability. When we invest in people through education and health, they become human capital, which can contribute to the country's growth. We saw the stories of Sakal and Vilas to understand how education and health can change lives. We learned about the three sectors of the economy - primary, secondary, and tertiary - and the difference between economic and non-economic activities. We understood the importance of education in improving the quality of population and saw the trends in literacy rates in India. We learned about health and how it affects productivity. We studied the problem of unemployment, including seasonal, disguised, and educated unemployment. Finally, we saw the story of a village that transformed itself through investment in human capital.

The key takeaways from this chapter are that people are the most valuable resource of any nation. With the right investment in education and health, every person can become an asset that contributes to the nation's growth. We must strive to improve the quality of our population through better education and healthcare facilities. And we must address the problem of unemployment by creating more opportunities and developing relevant skills.

So students, always remember that you are the most important resource of your country. By studying hard and staying healthy, you can contribute to the development of India and make it a prosperous nation.

Thank you so much for your attention. I hope you enjoyed this lesson and learned something valuable. See you in the next class!