INVESTMENT AND EMPLOYMENT GENERATION IN MICRO-ENTERPRISES OF NORTH KARNATAKA: AN ANALYSIS IN REGISTERED MANUFACTURING AND SERVICE MICRO-ENTERPRISES

Abstract

The micro-enterprise sector is an economic engine that creates employment opportunities in developed, developing, and underdeveloped countries. It has a different range of manufacturing products and services and lower capital than large industries. In India, MSMED Act, 2006, reveals the investment level is higher in the micro manufacturing sector than in the microservice sector. According to the ministry of MSME, the microenterprise industry accounts for 97 per cent of the total employment in the Micro, Small, and Medium Enterprise sectors. In the case of the employment level of micro-enterprises, which sector creates more work, whether the manufacturing or service sectors? The present study attempted to compare the investment and employment generation level between registered micro manufacturing and service enterprises and examine association between investment and employment level in registered micro manufacturing and service enterprise sector in North Karnataka. The researcher collected secondary data from the District Industries Centres (DIC) in five districts of North Karnataka. 385 samples out of 10,270 micro enterprises listed given by DICs selected by Slovin’s formula have been categorised using the stratified random sampling method. The researcher used a non-parametric Mann-Whitney U-test and Spearman’s rank correlation to analyse the data. The researcher found that there is a significant difference in investment as well as employment generation level between manufacturing and service micro-enterprises. There is a positive and significant association between investment and employment level in the micro manufacturing enterprise sector but a negative and not significant association between investment as well as employment level in the microservice enterprise sector.