India’s workforce goes casual

India’s workforce goes casual

New Delhi: There are more casual workers today than there were five years ago, according to government data—an indication that the quality of the workforce has changed in this period, which also saw a contraction in employment growth as reported by Mint last week.

Also See | The Changing Profile of The Indian Workforce (PDF)

Between 2004-05 and 2009-10, the number of casual workers grew by 21.9 million, while growth in the number of regular workers nearly halved (compared with the period between 1999-2000 and 2004-05) to 5.8 million; the number of the self-employed, dominated by agricultural workers, declined by 25.1 million. Analysts say that this is being caused by the country’s archaic labour laws and by the partly exclusive nature of economic growth.

The changes are reflected in the data released by the National Sample Survey Office (NSSO), the ministry of statistics and programme implementation.

Details of the increase in the number of casual workers are available in the report that was uploaded by NSSO over the weekend.

The report shows a substantial shift between 1999-2000 and 2009-10 in the structure of the labour force which can be broadly divided into self-employed, regular, and casual workers. Part of the reason could be that 2009-10 was a drought year, possibly forcing some among the self-employed (farmers are part of this category) into casual labour.

Casual workers are employees who do not enjoy the same benefits and security as tenured employees. All daily wage employees and some categories of contract employees are casual labourers.

“Till last year, we thought India’s growth could do no wrong. We took it for granted... Now it comes to a point that none of these can be taken for granted. Growth is slow, inflation is structural and structure of employment is not enough to cater to the growing labour force. Even that shining part of India is not so shining," said Pratap Bhanu Mehta, president, Centre for Policy Research, a Delhi-based think tank.

Manish Sabharwal, chief executive officer of leading staffing company TeamLease Services Pvt. Ltd, said casual workers constitute 30% of the workforce and added that the main issue is that 92% of India’s workforce is in the unorganized sector. “The situation has not changed since last 20 years."

Sabharwal argued that the focus should move from casual workers to shrinking the unorganized workforce; casual workers or temps (temporary workers) in the organized sector can enjoy the benefits of minimum wage, health and other benefits.

“The world of work has changed from mai-bap (paternalistic, therefore long-lasting) relationship to a taxi-cab relationship. Short yet intimate," Sabharwal said.

According to the newly formed Indian Staffing Federation, the staffing industry is worth 11,000 crore.

On Saturday, Mint reported that the first stint of the United Progressive Alliance in office generated a mere 400,000 new jobs a year, compared with 12 million jobs a year during the tenure of the Bharatiya Janata Party-led coalition, the National Democratic Alliance.

The numbers present a stark contrast to the Planning Commission’s target of 58 million jobs in the five years between 2007 and 2012.

According to NSSO data, the worker population ratio (usual status), the metric used to measure employment generation, has actually declined in the five-year period ended 2009-10 to 39.2% from 42% in 2004-05; in 1999-2000 it was 39.7%.

Principal adviser in the Planning Commission Pronab Sen said this is because 2009-10 was a severe drought year. “In such a bad year, typically marginal farmers are unable to till their own fields and spend more time working for others which is why the number of casual workers has gone up. Both the employment as well as the consumption surveys will be redone in 2011-12 precisely because 2009-10 was the worst drought year in 35 years," he said.

Sen added that another all-India survey by NSSO on debt and investment could throw up interesting facts about change in landholdings as usually during a drought year, marginal workers sell their lands.

There have been portents of the dismal employment generation numbers. Using data from the 64th round of the NSSO survey conducted in 2007-08, the Economic Survey of 2009-10 reported that only “4 million job opportunities" were created between 2004-05 and 2007-08.

Politically, the disclosures on jobless growth and casualization of the workforce can prove to be politically uncomfortable for the UPA, which is at present fighting allegations of corruption in public office and its failure to contain inflation.

Tapan Sen, secretary general of the Centre of Indian Trade Unions, said, “Whatever GDP (gross domestic product) is growing, it is because of the labour force. Profit is growing, but the value of labour is going down."

“On the one hand they (industrialists) are saying that 92% of the workforce is in the informal (unorganized) sector, which means labour laws are not applying on them; on the other hand they are making noise about rigidity. In private sector 80% of the workforce is casual, this itself is a violation of rules," Tapan Sen argued.

Sandeep Bhatnagar/Mint

Prashant Nanda, Liz Mathew and Asit Ranjan Mishra contributed to this story.

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