Jobs stagnate, lay-offs on the rise

Over the weekend, when Maruti Suzuki declared a lock out at its Manesar plant in Haryana, it didn't just put jobs of the 3,000 workers employed there at stake. Workers in the ancillary units of the company too could be in trouble.

The violence and lockout came on top of months of slowing growth of the Indian economy, depressed export markets, poor consumer demand, high interest rates, and lack of a policy stimulus — which is now pushing companies to freeze salaries and resort to lay-offs.

Plus, with the government refusing to amend labour laws, companies increasingly prefer using contract workers at lower wages instead of hiring them outright — the proximate reason why unrest flared at Maruti.

Official data shows that employment in eight key sectors during the January-March 2012 quarter grew slowest compared to the three previous ones. This coincided with economic growth falling this quarter to a nine-year low of 5.7 per cent.

The latest Quarterly Quick Employment Survey of the Labour Ministry pegs job addition in the fourth quarter of 2011-12 at a mere 0.81 lakh as compared to 2.26 lakh jobs in the previous quarter. It covered sectors such as textiles, leather, metals, automobiles, gems and jewellery, transport, information technology, BPO and handloom, powerloom.

A worried Labour Ministry has begun discussions with the Ministry of Commerce and Industry to include more export-oriented sectors in the surveys. "It is imperative to identify sectors that are being affected by the slowdown so that there is some policy action to address job losses," a senior Labour Ministry official said.

Only one sector, in fact, is consistently providing jobs to workers — the construction sector, which now accounts for nearly as many jobs as the manufacturing sector. However, construction sector work is risky, low-paid and mostly without any social security benefits. Plus, the value added by construction sector is less than 11 per cent of the total industrial output, where manufacturing accounts for over 70 per cent.

... contd.

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