State Of Inequality In India: Five Facts To Know

The top 1% of income earners in India cumulatively earn more than three times of what is earned by the bottom 10%. The share of the top 1% in income increased to 6.8% as of 2019-20. The 10% earned 30-35% of total income.

These are some of the stark facts pointing to wide inequalities in the Indian economy as brought out in the 'State Of Inequality In India' report released by the Prime Minister's Economic Advisory Council on Wednesday.

"With a vast concentration of incomes and wealth at the top driving the forces of inequality, the solution lies in redistributive measures and building economic resilience among the poorest of households through social protection schemes," the report argued.

Fact 1: Rs 25,000 A Month = Top 10% Of Wages Earned

According to the report, a monthly salary of Rs 25,000 or an annual salary of Rs 3 lakh means that you are in the top 10% of wage earners in the country, based on data from the Periodic Labour Force Survey for 2019-20.

"If an amount like this comes in the top 10 percentile, then the bottom-most condition cannot be imagined," the report said. "Therefore, the target should be to incentivise those on the bottom in a way that increases their disposable income."

Fact 2: 15% Of The Workforce Earns Less Than Rs 50,000

Nearly 15% of the entire workforce earns less than Rs 50,000 (less than Rs 5,000 a month), the report said.

The PLFS data reported negative and zero incomes, indicating that several households have no disposable income or their debts and borrowings exceed their earnings.

Fact 3: Top 1% Earn Three Times What The Bottom 10% Does

Income inequality is reinforced by the wide gap in cumulative earnings between the top income earners and those at the bottom.

According to the annual report of the PLFS 2019- 20, the annual cumulative wages came to be around Rs 18,69,91,00,000.

The top 1% earned nearly Rs 1,27,48,00,000.

The bottom 10% accounted for Rs 32,10,00,000.

This indicated that the top 1% earns almost thrice as much as the bottom 10%, the report said.

Fact 4: Share Of Top 1% In Total Income At 6.82%

The share of the top 1% in total income has increased from 6.14% in 2017-18 to 6.84% in 2018-19. It dropped marginally to 6.82% in 2019-20.

The top 10% earn more than 30% of the total income, the report said. "However, a marginally downward trend can be observed from holding 35.18% in 2017-18 to 32.77% in 2018-19 and 32.52% in 2019-20."

The bottom 50% held approximately 22% across the three time periods.

Fact 5: Only 33.5% Of Workers Have Regular Salaried Jobs

The share of regular salaried workers remains low in India at 33.5%. Self-employed workers make up 45.78% of the workforce, while casual labour makes up 20.71%.

• The average monthly salary of regular salaried/wage earners in July-September 2019 amounted to Rs 13,912 for rural males and Rs 19,194 for urban males.

• Employed females in rural parts earned Rs 12,090 in the same period, while females in urban India earned an average Rs 15,031.

• For the self-employed workforce, the average earnings were Rs 9,661 for males and Rs 4,558 for females in rural India.

• In the urban region, the average salaries for July-September 2019 period came to be Rs 17,166 for males, and females earned an average of Rs 7,141.

• Casual workers employed in works other than public works earned an average of Rs 268 (Rs 297 for male workers and Rs 185 for female workers) in rural India. Rs 356 were earned on average in urban areas, with Rs 311 for males and Rs 190 for females.