Last week’s E8 segment included households wherein the chief wage earners were school-educated skilled workers in their older years, living alone without their children. Today, we move down the years to younger school-educated skilled workers who live with families — they may be single or married, but without children. This segment, F1, includes 900,000 households, but with large household sizes; the population in this urban consumer segment is more than 3.3 million.
These are relatively low-income households—the median annual income is Rs1 lakh and more than 80% of households earn less than Rs3 lakh a year. This is despite the fact that in half the households, there are two or more earning members. In the F1 households, the chief wage earner is very young, and with low education levels. A quarter are less than 25 years of age—the fact that they are shouldering the burden of the household at such a young age speaks volumes about the background of these households. Even when other members are earning, they are clearly not adding substantially to the family kitty, so these are homes with low education and skills. Yet we find the education level rising with the younger generation; seniors in these households would be those with barely any school education, but all F1 chief wage earners have at the very least completed middle school and are eligible for training in some courses at vocational institutes.
Also See | Indicus Analytics Research (Graphic)
Segment F1 (Graphic)
The F1 households would be the fortunate ones among young low-income groups, compared with the G1 households taken up as the very first in this series, where skilled workers who have just completed primary school share the same characteristics as unskilled workers. This is because those skilled workers who have only completed primary school would have learnt their skills from some informal sources, and, hence, the employment opportunities would be more limited. Even in the unorganized sector, the lack of a basic class VIII pass certificate would keep a lid on their wages.
Consumption levels and patterns would be similar between primary school-educated skilled workers and unskilled workers within the G1 segment. If and when the Right to Education Act guaranteeing free and compulsory education till the age of 14 translates into actual delivery on the ground to all children, even in rural areas, we can expect the G1 households to shrink in size and merge with F1 households over the years. Though that could be sometime in the future, the F1 segment is set to grow in size.
F1 households are split evenly among married and single chief wage earners. In any case, those who are married do not have children yet. There are children in many of these households, but they would either be younger siblings or relatives staying in the city to study. Spouses are by and large homemakers, and 14% have barely completed primary school.
The majority of chief wage earners are in salaried jobs, their regular income providing much-needed support in these households where others are not adding as much. A third are self-employed—these would include providing services such as plumbing, electrical work, welding, etc. The dominant sectors of employment are manufacturing and trade—mostly in small firms or businesses. Eighteen per cent are employed by large private sector companies, the government or public sector firms. Transport, communication, construction and real estate are the next sectors that draw in F1 chief wage earners.
As far as asset ownership goes, these households are equally split between those who own their homes and those living in rented houses. Whether owned or rented, these houses would be small, a majority in slums, a source of cheap labour for cities.
Indicus Analytics Research graphic by Shyamal Banerjee/Mint
F1 segment graphic by Ahmed Raza Khan/Mint
Indicus Indian Consumer Spectrum Series XXV
This series is brought to you by research firm Indicus Analytics Pvt. Ltd