Labour shortage in manufacturing units in India: Causes and solutions

With the ever-increasing growth of the service sector, as well as other infrastructure like roads, manufacturing business owners are suffering from a gigantic issue of labour these days. These manufacturers primarily produce unbranded garments, shoes, fashion accessories, and small items utilized in daily life.

Small and micro-level entrepreneurs who undertake job work for large companies are also suffering from the issue of labour. Specialists indicate that to eradicate the issue of workers, they will either have to enhance the salary of workers or provide them with PF and medical-related facilities or they will have to automate the production. Both of the options will make their cost higher.

Currently, there are hundreds of such small plants that are performing manufacturing activities in numerous states, such as Delhi, Punjab, Haryana, Rajasthan, Uttar Pradesh, where workers do not get PF and health-related facilities. Deepak Arora, who makes nail polish, lipstick, bindi, and other beauty products in the Narela area of ​​Delhi, said that 10 years ago, the workers working in his factory always used to recommend someone or the other for employment.

Now the situation is such that we have to recommend that the workers to bring more workers. Boards demanding workers can be found hanging outside small factories in all industrial areas of Delhi from Okhla to Narela, Bawana. Anil Bhardwaj, general secretary of Federation of Indian Micro, Small and Medium Enterprises, says that such non-branded manufacturing units will now have to increase their cost to get workers, otherwise they may be out of the market in future.

Nitin Agarwal, who makes small plastic items, said that many of his workers are now going to Kerala instead of Haryana and Delhi because they are getting a daily wage of Rs 1,000 in infrastructure work there. Small factories cannot pay Rs 30,000 per month to a worker. On the other hand, in the last five years, the work of quick commerce platforms like Zomato, Swiggy, and Blinkit is growing rapidly. Every year, lakhs of youth are getting jobs in the quick commerce and e-commerce sector and most of the workers coming into this sector were working in the unorganized sector or informal manufacturing units.

By the year 2029, the business of quick commerce will increase from 3.4 billion dollars to over nine billion dollars and by the year 2027, 25 lakh people will be working in this sector. In the quick commerce and e-commerce sector, these workers earn more than 20,000 rupees per month, whereas in unorganized manufacturing, they get a maximum of 15,000 rupees per month and have to work harder. The demand for daily wage laborers has also increased due to the government's increased focus on infrastructure construction in the last 10 years. Construction work is happening rapidly across the country.

At these places, workers easily get 25-30 thousand rupees. With the network of roads and increased transport facilities, workers are no longer dependent on any particular city or place for work. They immediately migrate to those places where they get higher wages. Due to the good condition of roads connecting villages to cities, workers now come to cities near the village and do small business, which earns them as much as they get by working in factories in big cities.

According to experts, apart from all this, since the Corona period, the government has been giving free ration to 80 crore people. They do not have any problem of food. They also get some daily wages by making job cards in MNREGA. They also get money for housing. With these facilities, if they earn even Rs 500 a day, then their life goes on comfortably in their villages or towns because the expenses there are also less.