What is the Difference Between Organised Sector and Unorganised Sector?

By BYJU'S Exam Prep

Updated on: November 9th, 2023

The Difference Between Organised Sector and Unorganised Sector is that the organised sector is well organised by the Government while unorganised sector is not. The organised sector is organised on the terms of employment and structure. Whereas in the unorganized sector, there is no such well-defined structure. In this sector, people usually work for a low wage and in bad conditions.

Difference Between Organised and Unorganised Sector

The Organised Sector is authorized by the government. It must act in accordance with the laws and ordinances set out in various laws, including:

  • Gratuity Payment Act
  • Shops and Establishments Act
  • Minimum Wages Act
  • Factories Act.

The major Difference Between Organised Sector and Unorganised Sector are as follows:

Organised Sector Unorganised Sector
Well structured and recognized by the government of India. Poorly structured and no recognition.
Fixed terms of employment, fixed working hours, and fixed wages for the employees. No fixed terms of employment, random working hours, and no fixed wage.
Medical and other benefits are provided to the employees. No benefit of any sort is provided.
The employees get a healthy work environment, benefits, and wages. Employees are not entitled to any benefits or wages. Also, there is no guarantee of a healthy work environment.
Organized sectors also comply with Indian laws and regulations, such as the Minimum Wages Act, Factories Act, the Gratuity Payment Act, the Shops and Establishments Act, etc. There is no compliance in the unorganised sector with Indian laws and regulations.
Examples: Government-sector jobs, industries, etc. Examples: Farming, bonded labor, shopkeeping, etc.

Organised and Unorganised Sector Examples

The organized sector examples are banks, registered industrial workers, Government schools, colleges, and employees.

Four examples of the unorganized sector are domestic works, hotel management, and construction companies.

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