Employment, Efficiency and Entrepreneurship in Small Industry: A Study of the Baking Industry in Punjab, India

Abstract

Small industry continues to play a very important role in development, particularly in developing economies. However, recent changes particularly in the policy have questioned their role and relevance for development as many ills plague this sector. The small industries sector today is viewed as inefficient, highly capital intensive and outdated in terms of production technology and, consequently, products. This article examines some aspects of small industry in the context of the secondary food processing, consumer industry-the baking industry-in the state of Punjab, India. It was found that the employment generated by the small-scale sector is irrelevant to the local economy and, therefore, does not cater to its needs. The small-scale baking industry also exhibits on the one hand elements of being capital intensive and on the other, low productivity. This industry, as such, is less efficient compared to the large-scale sectors of industry. As far as entrepreneurship is concerned, refugee households, who had started with meagre funds, dominate this industry. Only of late have entrepreneurs hailing from other diverse backgrounds started entering this sector.