COVID-19 Reveals Deep Vulnerabilities in India’s Labour

COVID-19 Reveals Deep Vulnerabilities in India’s Labour

India has been in the throes of an economic crisis for the past 18 months now. Until a fortnight ago, the rot that besets the country’s economy was almost exclusively narrated in financial jargon through countless graphs and charts, and in terms of declining growth rates and rising consumer price index. The coronavirus pandemic and the nation-wide three-week lockdown has brought to the fore the human face of a deeper crisis which has been building for decades now.  

The COVID crisis has pulled off the convenient cloak of neglected hard truths and fault lines in our economic system. Behind the econometric data lies the darker underbelly of labour and exploitation that fuels India’s economic growth. The haunting images of countless unemployed labourers walking hundreds of kilometres to reach the relative safety of their villages is a stark reminder of the precarious conditions in which they live and eke out livelihoods. As the crisis and the uncertainty around it deepens three deep vulnerabilities of labour in India lay exposed.  

Migrant Labour

First: Estimates peg the numbers of migrant workers in India at roughly 139 million. The seasonal and circular nature of their work, as they leave their homes to seek livelihood elsewhere and return back to their families in villages, means that this floating population remains largely undocumented and thus invisible.

Inter-state migrants are prone to higher degrees of exploitation. Whether in Maharashtra’s cane-cutting industry or textile and apparel factories in Tamil Nadu, a combination of poverty, low skills and lack of bargaining power forces migrant workers to work long hours, often in unsafe conditions, for less than minimum wages. Cut off by language, culture and familiarity, this vast labour force which is integral to the economy (since micro, small and medium enterprises, MSMEs, employ migrant workers the most and contribute around 45 percent of overall exports from India) is most vulnerable to non-payment of wages, physical abuse, accidents and even death, while justice and remedy remains inaccessible for most. The  transient nature of their work also means that this vast workforce is deprived of state provisions and basic entitlements from the ‘source’ (where they come from) and ‘destination’ (where they work). The Inter-State Migrant Workers Act (1979), the only one of its kind that provides certain safeguards, is in practice obsolete and hardly ever enforced. After all, state governments cater first to local interests and political constituencies, and since migrants are unable to vote during elections,  they remain neglected. Trapped in cities without any income, starvation and hunger poses a much greater concern for them than the novel coronavirus.

Informal Economy

The vulnerabilities of migrant workers is symptomatic of India’s economy, which is overwhelmingly unorganized and informal. According to recent PLFS and Economic Survey data, more than 300 million out of a 465 million-strong labour force are engaged in casual employment without formal guarantees and are largely devoid of any social protections to ensure basic standards of living. This includes regular and daily wagers— factory workers, shop attendants, construction labourers and domestic help— as well as more than 100 million landless agricultural labourers. For the latter during the current crisis, rural employment guarantee schemes (MGNREGS) will not apply since this is not a harvesting or sowing season. Making ends meet, at times of death, illness and old age has always been a challenge. Now, in times of large-scale shocks and disruptions, without safety nets to fall back on it is even harder.

India spends just over 2 percent of its Gross Domestic Product (GDP) on social protection schemes and policies, the majority of which is targeted towards its rural population. Yet, the country’s urban population stands at 34 percent, and is growing steadily. Although the World Bank claims the numbers of poor in India have halved over the past two decades, the percentage of those who are vulnerable to slipping back into absolute poverty has increased to 40 . Without work, wages and social protection, the COVID pandemic has pushed more than 90 percent of India’s labour force on the edge of abject poverty and deprivation.   

Contractualization of Labour

Of the remaining workforce, less than 10 percent of which is employed in the formal sector, there is a clear shift towards contractualization of labour. Contract workers are not hired directly by the employer, rather by an intermediary or a contractor on a short-term basis. It should be noted that directly hired workers on an average are paid one and a half times more than contract workers. Moreover, unlike directly hired workers in the formal sector, contract workers can be dismissed at will. Not only that, they receive far fewer benefits in terms of health, safety, welfare and social security covered by legislative provisions

Between 2000 and 2015, the share of contract labour in India’s manufacturing sector has swollen from 15 to almost 28 percent, while that of directly hired workers has reduced to 50 percent from 61. In other words, even within the already shrunken formal sector in India, there is growing informalisation of the organized workforce. Thus, job insecurities which are typical of the informal sector, along with diminished real wages have percolated into the organized sector. Wage negotiations of unionized workers are often determined by a bargaining process and the presence of an alternative and cheaper workforce, in the form of contract workers, has considerably diluted such efforts.  

Labour, of course, is not a homogenous category. The labour force mirrors the prejudices of the larger society.  Women and adolescent girls, 90 percent of whom are employed informally, are paid significantly less than men for the same work. They are subject to greater verbal, physical and sexual harassment and abuse. Those belonging to Dalit and Adivasi communities are relegated to performing the most inhuman and degrading work, with scant regard for their life and wellbeing.

Despite some being worse off than others, what unifies labour in India are experiences of injustice and indignity, trapped in a socio-economic system that favours only the top one percent of the population while leaving the rest in a lurch. The COVID pandemic, ostensibly a health crisis, is also a wake-up call to critically relook at the inherent structural inequalities and the systems that allow it to continue. The critical juncture we find ourselves at is also an opportunity to build an inclusive, human economy that cares for the most marginalized and treats all with fairness and equality.             

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