DAILY NEWS ANALYSIS

GS-III : Economic Issues Labour

15 October, 2020
5 Min Read

Labour’s data lost

Context:

Recently the Code on Social Security; the Code on Occupational Safety, Health and Working Conditions; and the Code on Industrial Relations and Code on Wages.
The four labour codes together subsume more than 40 labour laws.

Labour force in India:

There are nearly 50 crores ‘informal’ workers in India and informal workers contribute nearly 50% of the GDP.
As per the 2017 Economic Survey, there are about 14 crore migrants, half of whom are inter-state workers.
These inter-state migrant workers contribute about 6% of the GDP.
A majority of the inter-state labourers are self-employed and/or engaged in casual labour with limited opportunities for skill-building and increased wages.

Issues:

1. Effectiveness of the new labour codes:

The mission statement from the Ministry of Labour and Employment emphasizes the following objective with respect to the labour force in India.
“Improving the working conditions and the quality of life of workers through laying down and implementing policies/programmes/schemes/projects for providing social security and welfare measures, regulating conditions of work, occupational health and safety of workers, eliminating child labour from hazardous occupations and processes, strengthening enforcement of labour laws and promoting skill development and employment services”
However, there are concerns that the new labour codes lack sufficient social protection measures to vulnerable informal workers.

2. Neglect of the informal sector:

The Labour Ministry has sought to focus its skill development initiatives primarily on the formal sector, neglecting the urgent need to better assess the capabilities and improve the skills of the informal sector as well.

3. Negative impact on workers:

The high levels of informal employment have negative impacts not just on the workers but also on the country’s economy because of the following reasons:
- The informal sector does not provide learning and training opportunities thus impeding the workers’ chances to upgrade their skills. This leads to their low productivity and low incomes for such informal labourers.
- The informal sector also seems to be compounding the existing inequality in the country.
- The low income of the informal labourers limits their children’s access to quality education and training, nutritional security and health and this act as a major impediment to their upward social movement.

4. Negative impact on economy:

The low productivity and continuing inequality in the economy act as a major drag on the economic development of India.

Source: TH

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