Service Activities in India — Important Questions

Community, social and personal services

According to the table in the chapter, Community, social and personal services employed 90.5 lakh people in government jobs in 2010, which was the highest among all service categories. This category includes services like education, healthcare, social welfare, and various community services provided by the government. Transport, storage and communications had 25.3 lakh, finance had 14.1 lakh, and wholesale/retail trade had only 1.7 lakh government employees, making community services the largest employer in the government sector.

Reduce costs and avoid additional benefits to workers

Outsourcing helps companies reduce costs and avoid paying additional benefits like health insurance, pension, and provident fund to workers. Instead of hiring security staff directly, companies now outsource security services to specialized agencies. This way, they don't have to provide employee benefits to security personnel. Similarly, companies outsource research and development, accounting, legal services, and customer service to reduce operational costs and focus on their core business activities while avoiding the overhead costs of maintaining these departments internally.

Continuously changing technology

The chapter clearly states that continuously changing technology is one of the major driving forces in the service sector. Since the early 1990s, tremendous changes in communication technology have created new opportunities like BPO, IT services, call centers, and internet-based services. Technology has enabled the growth of entertainment industry, banking and insurance services, advertising, and many other service activities. These technological advances have transformed how services are delivered and created entirely new categories of service employment.

Across the globe

Call centers in India serve customers located across the globe using telecommunication links. The chapter gives an example of a London resident getting information about her bank deposits or hospital records from a call center located in India. This global reach is made possible by advanced communication technology that allows real-time interaction between service providers in India and customers anywhere in the world. This has made India a major destination for global outsourcing of customer service and support functions.