This article is part of the UPSC Daily Editorial Analysis, covering The Hindu editorial – "Indian industry needs innovation, not mindless toil," published on 24th February, by the best UPSC coaching in Kolkata.
Syllabus: GS-III (Indian Economy, Employment & Labour Market)
A recent study on migrant industrial workers in Ludhiana, Punjab highlights the gruelling work conditions they endure.
Workers in garments, auto-components and manufacturing often work 11 to 12 hours daily, sometimes without breaks. Their struggles extend beyond factory hours, including long commutes and household responsibilities.
Despite exhausting schedules, corporate leaders push for even longer hours, ignoring that most Indian workers belong to the informal sector.
As per Periodic Labour Force Survey (PLFS) 2023-24, only 21.7% of India’s workforce holds regular salaried jobs, with half lacking formal contracts, paid leave, or social security.
Long hours without protections worsen economic inequality. Stronger labour laws and enforcement are crucial for worker welfare.
Indian industry prioritizes cheap labour over technology for competitiveness. Unlike developed nations that boost productivity through efficiency and innovation, Indian businesses extend work hours and suppress wages to sustain profits.
Karl Marx described capital’s “werewolf hunger for surplus labour” during Britain’s Industrial Revolution. By the mid-19th century, Britain’s labour laws improved conditions, while India remains stuck in a low-wage, long-hour model.
As per ILO 2024 data, the average weekly work hours in different nations are:
• United States: 38 hours
• Japan: 36.6 hours
• India: 46.7 hours
To maintain low wages, Indian businesses have shifted from the organised to the unorganised sector, where labour regulations are weak. Industrial hubs like Coimbatore and Ludhiana are dominated by small, unregistered units employing fewer than six workers.
These micro-enterprises, often run by former workers turned owners, operate in fragmented supply chains, supplying components to larger firms.
Over 70% of India’s manufacturing workforce (approx. 68 million in 2021-22) works in small, unregistered enterprises with fewer than 10 workers. These firms struggle with:
The growing reliance on contract labour has weakened workers' rights. Since 2011-12, nearly 56% of new factory jobs have been filled by contract workers, who are underpaid and lack social security benefits.
Migrants form the backbone of India’s industrial workforce, yet low wages and insecure jobs widen economic inequality.
The post-pandemic period saw a sharp rise in corporate profits, while real wages stagnated. In India’s factory sector, the profit-to-value-added ratio jumped from 31.6% (2019-20) to 46.4% (2021-22), highlighting growing income inequality.
Despite India's labour surplus, the garment industry has failed to gain a competitive edge. India's garment export share has stagnated at 3.1% for two decades while China, Bangladesh and Vietnam have surged ahead.
A major cause of stagnation is the lack of technological upgrades. Many Indian firms prioritise low wages over modernisation limiting their growth in export markets dominated by Western multinationals.
The widespread availability of cheap labour has hindered industrial innovation. Even in emerging sectors like IT, low wages have weakened domestic purchasing power, restricting economic growth.
By focusing on profit maximisation over worker welfare, industries risk creating an impoverished workforce that cannot drive economic demand. This leads to:
Indian industry’s dependence on long working hours and low wages may offer short-term gains but hampers long-term growth.
For sustained economic progress, industries must adopt:
Policymakers and business leaders must recognise the urgency of these reforms to ensure sustainable industrial growth before it is too late.
MUST READ ARTICLES
|
PRACTICE QUESTION Q.Examine the impact of long working hours and informal employment on India’s industrial workforce. 250 Words. |
1. What are the impacts of long working hours on India’s industrial workforce?
Excessive work hours (11-12 hours daily) lead to poor health, low productivity and worker exploitation. It also reduces innovation and economic efficiency.
2. How does informal employment in India affect industrial workers?
With only 21.7% of workers in salaried jobs, most lack job security, contracts, paid leave and social benefits, increasing economic vulnerability.
3. Why does India’s manufacturing sector rely on cheap labour instead of automation?
Indian industries prefer low wages and extended work hours over technology adoption, unlike developed nations that boost productivity through innovation.
4. What are the challenges faced by small manufacturing enterprises in India?
Small units in Ludhiana, Coimbatore struggle with delayed payments, high input costs and limited access to credit, affecting growth and stability.
5. How has contract labour impacted India’s industrial workforce?
Since 2011-12, 56% of new factory jobs are contract-based, leading to lower wages, job insecurity and lack of social protections.
6. Why is India’s garment industry unable to compete globally?
India’s garment export share stagnates at 3.1% due to lack of modernisation, dependence on cheap labour and reluctance to invest in technology.
7. How does India’s low-wage strategy impact long-term economic growth?
Suppressing wages weakens domestic demand, reduces innovation and harms global competitiveness, leading to an unsustainable industrial model.
8. What policy reforms are needed to improve India’s industrial workforce conditions?
India must focus on stronger labour laws, better wages, regulated working hours and technology-driven efficiency for sustainable growth.
9. How can policymakers and industry leaders ensure sustainable industrial growth in India?
By enforcing fair wages, improving working conditions and promoting innovation India can create a globally competitive and worker-friendly economy.
© 2025 iasgyan. All right reserved