Question

 Critically analyse the impact of economic liberalisation on the occupational
structure of urban India.

30 Jul 2026
Answer :
Word Count : 711
Economic liberalisation introduced in India in 1991 transformed the occupational structure of urban areas by shifting the economy from state-led development to market-oriented growth. The opening of markets, privatization, globalization, and technological advancement created new employment opportunities while also reshaping the nature of work, labour relations, and occupational mobility. From the perspective of urban sociology, liberalisation not only altered the distribution of occupations but also changed class relations, migration patterns, and social inequalities within cities. One of the most significant impacts has been the rapid expansion of the service sector. Information technology, business process outsourcing, banking, finance, insurance, telecommunications, retail, hospitality, healthcare, and education emerged as major employers in metropolitan cities such as Bengaluru, Hyderabad, Pune, Gurugram, and Chennai. These sectors generated high-skilled and well-paid employment opportunities for educated urban youth, leading to the growth of a new middle class characterized by higher incomes, consumerism, and global lifestyles. Economic liberalisation also accelerated the decline in the relative importance of manufacturing employment in many urban centres. While industrial production expanded in some sectors, technological modernization and automation reduced labour demand. Several labour-intensive industries either relocated to peri-urban regions or adopted contract-based employment practices. Consequently, permanent industrial jobs declined, giving way to flexible and temporary forms of employment. The informal sector expanded significantly despite rapid economic growth. A large proportion of rural migrants entering cities could not access formal employment due to inadequate education and skills. They found work in construction, domestic service, street vending, transport, food delivery, waste recycling, and other informal occupations. This dual occupational structure created a sharp divide between secure formal employment and insecure informal work. Urban sociologists highlight that liberalisation increased labour market segmentation rather than ensuring inclusive employment. The emergence
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