Shrinking jobs, pay cuts and loss of perks owing to recession have taken a heavy toll on the labour force in India.
Take the case of Kerala, whose economy depends on the remittance of ordinary Malayalee workers in West Asia. State Finance Minister Dr.Thomas Issac told the State Assembly, recently, that two lakh persons were likely to return to the State from Gulf countries.
Unfortunately, the threat of a return of Gulf migrants en masse,and the consequent fall in remittances, and the worsening unemployment situation come at a time when the signs of the global crisis are already visible in other sectors of the State’s economy. Prof.Irudaya Rajan, at the Centre for Development Studies(CDS) in Thiruvanathapuram, has observed that the State, with its export-oriented agriculture and under developed industry, has been more integrated with the world economy than many other States of India. Its best bet for survival has long been its exports of cash crops, spices and fisheries, all of which are now facing falling revenues under the global crisis, says a study by the CDS. This development has adversely affected the employment prospects of lakhs of ordinary workers in Kerala.
Tourism and IT, its other major revenue earners too are affected. Tourist arrivals are officially expected to go down by 30 to 35 per cent. Industry sources said hotels are only half full, chartered flights have been suspended and many more house-boats than before are being dry-docked.
An analysis of the media reports reveal that unemployment in India’s industrial and services sectors is on the rise. Some analysts point out that “unemployment in India’s industrial and services sectors is on the rise. If earlier growth was being described as “job less” the problem now is that growths that is lower comes with job losses.”
The recessionery impact that the global financial and economic crisis has contributed to huge job losses in various segments of the labour market. The Labour Bureau conducted a sample survey covering eight sectors to arrive at an estimate of the job loss. On the basis of this limited sample, it arrived at a figure of about half a million.
An Associated Chambers of Commerce and Industry of India(ASSOCHAM) study projected that in one year, one crore jobs will be lost. Trade union leaders argue that it will be much more. The job loss have been mainly in three sectors, textiles, leather and metal production. In Gujarat, three lakh workers have lost their jobs in the diamond cutting and polishing industry.
Central trade union leaders in press statements, recently, alleged that “bad economic and industrial policies of the central government” have cost the livelihood of employees and workers across the country. They said as many as 20 lakh have lost their jobs recently, and another 10 lakh may lose their in coming days.
One report said in one automobile factory, workers would now work only for three days a week and get no salary for the rest of the week. In several sectors, the managements, taking advantage of the crisis, are making workers do 12 hours a day without overtime.
Trade union sources said that voluntary retirements is being pursued vigorously by companies. The management of the steel industry has decided to retire 500 workers. Despite giving all kinds of concessions to special economic zones, exports have declined and retrenchment has taken place on a large scale.
One of the most significant attack of industry has been on employment tenure. This started in the 1990s with a series of voluntary retirements measures in the private sector. Many factories laid off tenured workers, luring them with carrots of large sums of money, along with the stick of violence. The public sector too followed suit in pressing voluntary retirement schemes(VRS), which was also a prelude to give a push for gradual privatization. Government regulation on industrial closure, while still on the statute books, became virtually non-existent. Instances of refusal by employers to negotiate with unions, or even recognize unions chosen by workers as set industry norms, are extensive.
It was also the period when contract employment stands dialuted. In a bid to further de-regularise, “trainees” are hired to perform tasks of full-time workers. Even in sectors where tenure of employment exists on paper, lack of union strength and weak labour laws has made it a sham. As a result, non-payment of provident fund and gratuity, overtime without payment, harassment at work place and arbitrary dismissals are rampant.
The only real wage protection, in today’s scenario, is the Minimum Wages Act. However, the implementation of this Act is woefully inadequate. Minimum wages are low and revised infrequently making it impossible to eke out an existence above poverty level. While there is decline in the employment in the organised sector, there is a huge increase in the number of casual workers. It is estimated that nearly 30% of the work-force today comprises of casual workers whose exploitation is a well known fact.
The Trade Union Act has already been amended, making it difficult for workers to register a union even. It has been described as making provisions that would reduce multiplicity of unions,reduce the number of ‘outsiders’ prohibit a Union of State Minister from being a member of the union executive. The Second National (Ravindra Varma) Commission on Labour has felt it would further be desirable to provide a ceiling on the total number of unions of which an ‘outsider’ can be a member of executive bodies. In its report, the Commission rejected the democratic demand for recognition of trade unions through secret ballot.
The current phase of liberalization has also freed the cap on executive pay and profit sharing. This has contributed to the growing income inequality in the country. Furthermore, while there is no ceiling on executive pay, bonus for workers remains capped. In 2007, the bonus ceiling for workers was raised after a gap of 14 years and is still below the wages of skilled workers. With the economic slowdown, workers are increasingly falling back on premature with-drawl of provident fund to tide over the present crisis.
According to the National Sample Survey Organisation(NSSO)total employment in both the organized and un-organised sectors is 397 million, of which just 28 million is in the organized sector. Labour laws in India cover only the workers in the organised sector, of which about 20 million are in the public sector. For remaining 369 million workers, there were no social security or welfare legislation, until the Un-organised Workers Social Security Act of 2008.
Various studies on the unemployment situation point out that India’s labour force is growing at a rate of 2.50% annually but employment is growing at only 2.30%. It is also acknowledged now that there is large scale under-employment in the country.
The International Labour Organisation’s(ILO) World of Work Report 2008 records that from 1990 onwards, wage inequality has risen across the globe including in India.
Juan Sanavia, Director General of the International Labour Organisation in a recent newspaper article observed that:”world unemployment could increase by 20 million by the end of 2009—surpassing the 200 million mark of global unemployment for the first time.”
The latest data of the ILO shows that by next year unemployment could hit global rates between 6.50 per cent and 7.40 per cent. This would roughly be equal to 210 million and 239 million unemployed world wide.
This is the situation when trade unions are regrouping and confronting the political establishment for better regulation of labour rights and greater control over industry and capital.