Yes, it is necessary to generate employment in the formal sector than in the informal sector because those who work in the informal sector do not get any regular income and do not get protection from the government. Workers are dismissed without any compensation. Technology used is outdated and they also do not maintain any accounts. Workers live in slums or badly built houses.
In India about 7 % of-the workforce is engaged in the formal sector and the rest 93 % in the informal sector. .
Those who work in the formal sector on the other hand earn more than those in the informal sector and also enjoy social benefits. It is thus, necessary to generate more employment in the formal sector.