by admin | May 25, 2021 | Business, Business Ideas, Entrepreneurship, SMEs, Startup Basics, Women Entrepreneur
By Richa Sharma,
New Delhi : Thirty-two-year-old Geeta sits patiently, painting pots created by her husband in the small open porch in her house at Kumhar Gram or Potters’ Village that interestingly has managed to find space in West Delhi’s Uttam Nagar.
Geeta says she desperately awaits for the Diwali season (October-November) every year, when it is boom time for the potters, who labour from dawn to dusk in the days leading up to the festival.
“Diwali is a boon for us,” Geeta told IANS, pointing to the four-fivefold rise in income during that time — against the average income of Rs 8,000 to Rs 15,000 per month during the rest of the year.
Leela Ram Prajapati, who has been a potter for the last 30 years, concurred. “We get maximum work during Diwali.”
Packed with magnificent ceramics, as also idols, vessels, artefacts and other items crafted out of mud, the narrow lanes of Kumhar Gram boast of a great deal of talent and artistry among the more than 400 families that have been settled in the locality since the 1970s.
Harikishan, whose efforts led to the creation of the colony, won a National Award in 1990. Today, as many as 12 potters at Kumhar Gram have been similarly honoured.
Despite these achievements and the talent they inherited from their ancestors, a majority of the potters in the colony do not want the future generation to continue with their profession because of the lack of facilities and the low income generated through the year, except for the month of Diwali.
“I don’t want my children to take up my profession when they grow up. I want them to do a fine job,” Pooja, a 34-year-old potter said, adding there was a huge problem managing the family expenditure on an income of Rs 10,000-Rs 15,000 in a month.
The potters had another grouse. While agriculturists in particular welcome the monsoon as it impacts their yields it often has quite the opposite impact on potters.
“Sometimes, the unbaked items get destroyed in the rain,” a potter said, adding there is no enough space inside the houses to accommodate all of what they have crafted but which hasn’t gone through the ‘bhatti” (ovn).
They also expressed anger at the rise of Chinese goods in the market.
“Due to the increasing flood of Chinese items, our sale is going down day by day. It affects our livelihood,” said Tarachand, a 48-year-old potter.
Even so, given their belief in karma, they labour on.
(Richa Sharma is an Intern at IANS)
—IANS
by admin | May 25, 2021 | Employment, Opinions
By Abhik Ghosh,
A recent amendment to the Industrial Employment (Standing Orders) Rules, 1946, has sparked excited debates by its proponents and critics alike.
Some observers see the latest move as the ushering in of much promised big ticket reforms in the labour and employment sector. Employers generally have welcomed the development, whereas workers’ representatives have by and large castigated it as a subterfuge for legitimising contract labour. Will the big bang sustain or will it end in a whimper?
I have argued elsewhere that, given the political situation — not to mention the disadvantage it faces in the Rajya Sabha — the government’s intent to bring about major legislative changes in the labour and employment sector may remain a pipe dream. If the National Democratic Alliance (NDA) government, with its overwhelming numerical strength in the Lok Sabha, could not steer through any worthwhile labour reforms in four years of its tenure, it is highly unlikely that the situation will change dramatically in the last year. The pragmatic route is to find areas that may be addressed through executive action. And that is precisely what the government seems to have done.
It has introduced a seventh category of fixed-term employees in addition to the extant six classifications of workers under Schedule 1-A of the Rules, for which conditions of service may be separately prescribed by the employer. The amendment lays down that fixed-term workers would enjoy the same emoluments and allowances as permanent workers, albeit pro-rated for the period of their employment. This places them in a category superior to contract workers who are generally paid less and do not enjoy any of the statutory allowances and benefits available to regular workers.
In this sense the government has tried to balance the wages, social security and welfare of fixed-term employees, but because their term is fixed, their termination with notice is inherent in their employment contract.
Fixed-term employment will provide employers with flexibility to adjust the workforce in response to changing market conditions, which has been a longstanding demand to aid ease of doing business. The seasonal and cyclical nature of employment in certain economic sectors such as apparel manufacturing and exports was earlier recognised and fixed-term employment was allowed.
The government has now extended the concept across all employment sectors with a view to providing more job opportunities and more secure working conditions for fixed-term employees. With rising economic growth, greater job openings and multiple skill levels, workers should be able to opt for greater employability rather than job security. Creative destruction should be the new catch phrase.
The lament that fixed-term employment will promote contract labour is the result of misconception. There is already empirical evidence of the secular growth of contractual employment across all employment sectors. The problem lies in the differential treatment of workers employed through contractors as compared to regular employees. By mandating comparable wages and allowances to fixed-term employees the government has tried to provide them with greater protection and benefits than workers supplied by and through contractors. It is salutary that employers have consented to the amendment despite the higher costs it would entail.
Will the new amendment promote employment generation, which is the government’s avowed objective, at a time when job opportunities appear to be shrinking? The higher cost of compliance may act as a dampener, but the jury is still out on that.
Trade unions resent the fact that the government’s intent to amend labour laws and rules was announced in the Finance Minister’s budget speech, indicating absence of prior tripartite consultations. Employers, on the other hand, are satisfied that the protocol of tripartite consultations have been followed. The fact that even the Bharatiya Mazdoor Sangh (BMS), a trade union centre affiliated to the ruling Bharatiya Janata Party (BJP), is critical of meaningful social dialogue on such important issues is worrisome. Perceptions in such cases matter more than form.
Is there any hope of big bang reforms in the labour and employment sector in the foreseeable future? Regrettably, it is a case of missed opportunities. The much-touted rationalisation and consolidation of 44 labour laws into four omnibus codes has yet to see the light of day.
Big ticket reforms such as amending Chapter VB and Section 9A of the Industrial Disputes Act, 1947, cannot take place as time is really running out for the present government. At best, it can undertake incremental steps by tweaking rules through executive action. The challenge is to put in place a few more such constructive changes aimed at speedy job creation by carrying all major stakeholders on board before the government goes into election mode.
(The author is former IAS and ILO Official. The views expressed are personal. He can be contacted at abhik.ghosh1@gmail.com)
—IANS
by admin | May 25, 2021 | Employment, Opinions
By Amit Kapoor,
The lack of jobs is beginning to haunt the Modi government. The Reserve Bank of India’s recent Consumer Confidence Survey shows that public perception is also beginning to take account of the fact that there are no jobs available in the economy. According to the survey, 43.7 percent of responders felt that the employment situation had worsened as compared to 31.9 percent a year ago.
The official unemployment numbers, which hover at around five per cent, will never reflect the true picture since in a developing economy, where poverty is high and unemployment benefits are virtually non-existent, no one can afford to remain out of the workforce for long. They usually find employment doing odd jobs or in the agricultural sector.
However, job creation numbers do give a clearer picture. According to the Labour Bureau, the Indian economy was generating around 900,000 jobs in 2010 and 2011. Since then, the jobs created in the economy have consistently fallen, reaching around 135,000 in 2015 as opposed to the need for an annual generation of over 11,00,000 jobs. The situation has not improved since.
However, this is not a recent phenomenon. The Indian economy has never been good at creating jobs. As per popular estimates, including those of the RBI, India’s employment elasticity, which is a measure of the percentage in employment for a one percent change in economic growth, has been around 0.2 in the post-reform period. This implies that as the real GDP rises by 10 percent, employment will merely rise by two percent. To put things in perspective, International Labour Organisation (ILO ) estimates Brazil’s employment elasticity to be an impressive 0.9.
This long-term trend shows that there is a structural reason behind this problem. When an economy transitions from agricultural-led to a modern one, it undergoes three key transformations: Movement of labour out of agriculture into industry and then services, shift of workers from informal into the formal sector and finally a rapid pace of urbanisation as more industries are set up in the rural areas around cities.
India has missed the bus on all three of these fronts. Industrial development never took place in India and the economy became service-led right away. Employment in industry and services remains predominantly informal. Consequently, the pace of urbanisation has slowed in India.
Moreover, whatever industrial development has taken place in India has been either capital-intensive or skilled labour-intensive. India’s labour-capital ratio in a vast majority of industries has been lower than other countries at similar levels of development. The very opposite is needed for job creation in a developing economy. But why has the pace of development been so skewed for India? What is so different about India that made it deviate from the historical trend of structural transformation for economies around the world?
India’s notoriously rigid labour laws are the leading cause behind these anomalies. Labour falls under the concurrent list of the constitution, which implies that both the Centre and the states can form laws on it and neither has been miserly about this. When combined, each state ends up with over 200 different labour laws. These disincentivise firms from growing beyond a point. For instance, the Trade Unions Act of 1926 requires firms with seven or more workers to form trade unions. The Factories Act of 1948 mandates manufacturing units with 10 or more workers to have several working hour limits and work place conditionalities that become stricter with more workers.
The most burdensome of all is the Industrial Disputes Act (IDA) of 1947, which covers all industrial disputes and makes it almost impossible for firms with 100 or more workers to fire anyone. Establishments require permission from the labour department to lay anyone off and such permissions are rarely given even if the firm is unprofitable. Therefore, firms with six or less employees have the most labour flexibility.
As expansion of firms comes with high legislative costs in India, it is rational for them to remain small. This is why 84 per cent of manufacturing employment is restricted to micro and small enterprises in stark contrast with other developing countries (46 per cent for South Korea and Thailand, 27 per cent for Malaysia and 25 per cent for China).
India’s labour laws have inhibited the growth of manufacturing firms, which lose out on the gains they could have made from economies of scale and innovation. Due to these reasons India has not been able to undergo industrial development and is finding it difficult to gain from the rise in labour costs in China. India could have been the next manufacturing hub after China but since there is a sheer lack of capability; countries like Bangladesh and Vietnam have been thriving in labour-intensive sectors like textiles.
Labour reforms are, therefore, the antidote to India’s perpetual job crisis — but this is politically sensitive topic. The Modi government is in a unique position of being capable enough of pushing through such bold reforms since it has the numbers needed for this. However, considering how most of its attempts at reform have backfired, this will be the farthest thing on the government’s mind. A piecemeal attempt at labour reform with the Small Factories Bill, which aims to exempt factories with 40 workers from 14 labour laws, has been in limbo for the last two years.
However, on a positive note, some state governments are beginning to allow larger firms to retrench workers without seeking permission with their own amendments to IDA. Hopefully, it will not be too late before India manages to extricate itself from this mess of its own creation.
(Amit Kapoor is chair, Institute for Competitiveness, India. The views expressed are personal. He can be contacted at amit.kapoor@competitiveness.in. Chirag Yadav, senior researcher, Institute for Competitiveness, India has contributed to the article.)
—IANS
