Formal sector subcontracting and informal sector employment in Indian manufacturing

IZA Journal of Labor & Development

Table 3 Modernity index informal sector, average by industry

Industry	Capital per worker	Location	Hired workers	Qualified owner	Modernity index
Tobacco products	8.39	0.08	0.17	0.01	−1.47
Wood and wood and cork products	9.35	0.16	0.22	0.02	−0.89
Other non-metallic mineral products	9.35	0.23	1.22	0.02	−0.57
Textiles	9.51	0.15	0.97	0.03	−0.54
Furniture; manufacturing n.e.c.	9.80	0.32	0.53	0.03	−0.41
Leather	9.91	0.33	1.04	0.03	−0.31
Food and beverages	10.18	0.44	0.60	0.01	−0.22
Metal products	10.09	0.50	1.01	0.04	0.00
Paper and paper products	10.57	0.28	1.08	0.08	0.08
Chemicals and chemical products	10.44	0.42	1.50	0.09	0.11
Machinery and equipment	10.52	0.48	0.95	0.07	0.15
Wearing apparel	10.15	0.30	2.58	0.15	0.18
Basic metals	10.76	0.47	1.54	0.14	0.48
Other transport equipment	10.70	0.61	2.00	0.11	0.48
Rubber and plastics products	11.05	0.62	2.12	0.11	0.50
Publishing and printing	11.03	0.68	1.73	0.07	0.60
Electrical machinery	10.77	0.73	2.35	0.12	0.71
Radio, television and communication equipment	10.98	0.68	2.38	0.18	0.77
Medical, precision and optical instruments	10.75	0.64	2.95	0.20	0.82
Motor vehicles	10.80	0.75	3.24	0.31	0.94
Office, accounting and computing machinery	10.76	0.40	7.20	0.40	0.96

Note: Unit of observation in the analysis is the state-industry; values in this table are averaged across states. Capital per worker is in logs, location is the share of enterprises with a fixed location outside the owner’s household, hired workers is the average number of hired workers per enterprise, and qualified owner is the share of proprietary enterprises with a technically qualified owner. The modernity index is the average standardized value, industries are ordered from lowest to highest modernity index.