The Freedom of Self Employment

Published: Mint dated 12 th April 2010

This is the 17th in a 33part

series on distinct
consumer segments,
based on a categorization
of stage of life and
occupation, expenditure
and savings propensity,
family structure and
psychographics. This
weekwe look at the E2
segment -- households
where the chiefwage
earners are married, with
no children, and live in a
joint family
Indicus Consumer Segment
Last week we took up the smallest urban consumer segment, E1, which has young, single
chief wage earners who lived in joint families and are school-educated businessmen. Keeping
the education and occupation profile the same, this week we look at E2 households, where
the chief wage earners are married, with no children, and live in joint families.
Yet another small segment, E2 households comprise those where the chief wage earners are
mostly in the age group of 25-34 years, are school educated, married and live in joint families,
but do not have children yet. With just over 80,000 households, this segment makes up 0.1%
of the urban population.
E2 households are significantly different from those in the E1 segment, as the household size
is larger and there are more earning members—nearly half the households have four or more
members and 63% have two or more earning members.

E2 Indicus Consumer Segment

Yet, the number of seniors are few: Just
21% of households have one or two
seniors. Given the joint family set-up in
this segment, this may seem a paradox.
However, the younger age profile of the
household members can be a reflection
of low educational levels and early
marriages. Moreover, joint families do
not necessarily mean parents living with
children, as the households could also
include relatives or friends who have
come to the city to study, work or train in
some profession. In fact, though the
chief wage earners do not have
children, 22% of households have one
or more minors.
The median household income is low at
Rs1.45 lakh per annum and the bulk in
this segment earns less than Rs3 lakh a
year. Yet 15% of households earn more
than Rs5 lakh per year, creating a small
relatively affluent intra-segment group.

Indicus Consumer Segment

While all the chief wage earners in this segment are
married, 40% live without their spouses—wives in the
villages or smaller towns, waiting for the spouse to
settle down or move out is one possibility.
House ownership is also lower in this segment when
compared to E1 households—just 48% own their
houses. This segment, therefore, forms a small
market for one-room flats or one bedroom-hall-kitchen
apartments, a demand that remains to be met across
urban India.
With low educational qualifications—nearly a quarter
of the chief wage earners have studied just up to
primary school—this segment is overwhelmingly self-
employed. Again, as mentioned last week, to a large
extent this is a reflection of the low employability of
the chief wage earners in this segment rather than of
inherent entrepreneurship talents. There is, however,
another aspect that is important for these small
businessmen. Often, rigid work rules clash with their
social obligations—for example, leave to attend
marriages, funerals, etc. is not easily available.
Freedom, therefore, is sometimes valued more than a
regular salary.
Indicus Consumer Segment
 The manufacturing sector takes up the largest
share of employment with 37% , followed by
wholesale and retail trade (24%), hotels and
restaurants (13%) and transport (12%).
While the concentration of households in this
segment is highest in the big cities of Mumbai,
Thane, Delhi, Bangalore and Pune, smaller
towns—not necessarily state capitals—feature in
the top 50 list, including Coimbatore,
Kanchipuram, Guntur, Durg, Jabalpur, Madurai,
Raipur, Kanpur, Thrissur, Kota, etc. These are in
a large part manufacturing centres or agricultural
mandis, drawing migrants from the hinterland and
offering significant scope for those who have little
educational qualifications but are prepared to
strike out on their own.

Indicus Consumer Segment