Arjun Sharma | May 12, 2019 | 13 min read
In Punjab’s Labour Hubs, Desperate Workers Settle For Paltry Wages
Bathinda: Stress has put deep wrinkles on Balkara Singh’s forehead though he is just 32 years old. The daily wage worker, dressed in a faded blue sweater and jeans, is a carpenter and for the last five years, he has been visiting the Gol Diggi labour hub in southern Punjab’s Bathinda city every single day in search of a job.
Most days he has returned home disappointed.
Poverty drove Balkar out of school when he was in Class 2 and his only dream was to earn enough to see his children---aged four and six---complete their education. His small house in Amargarh village where he lives with his wife, children and parents, is about 14 km from Gol Diggi. It takes two bus changes and Rs 30 to reach the hub.
Balkar is no longer sure if his dream of educating his children will come true. The far-reaching move by the Narendra Modi government in November 2016 to withdraw 86% of India’s currency, by value. The move called demonetisation had impacted jobs in the informal employment sector: agriculture, small scale textile units, unorganised retail businesses, construction work, tourism and so on.
Five million men, mostly from the unorganised sector, lost their jobs over the two years following demonetisation, said a new report ‘State of Working India 2019’. This, the latest estimate of job losses was published by the Centre for Sustainable Employment (CSE), Azim Premji University, Bengaluru, and released on April 16, 2019.
Balkar’s monthly income dropped from Rs 15,000 to less than Rs 9,000 now. Almost every worker we spoke to reported daily wages dropping from Rs 450-Rs 550 to less than Rs 300 now. This too is likely to plunge to Rs 200 towards the end of the month when desperation sets in among workers. Earlier, he could find construction and carpentry work almost every day but he is now used to going for almost a fortnight without any work.
Soon after demonetisation, the construction industry had “literally came to a standstill”, Balkar recalled, and there was a time when he worked barely four days a month. The casual job scene today is not as critical as it was then but the change is not significant, he said.
You hear stories like this across the Gol Diggi labour market, located at the heart of Bathinda’s commercial centre and surrounded by showrooms that sell expensive brands. Before demonetisation, labour was in short supply in Bathinda, many workers told us. From 8 am every morning, around 100-150 daily wage workers gather at the hub seeking cleaning, carpentry and masonry jobs among others.
The contractors arrive here in trucks and seek out workers willing to settle for low wages. By 11:40-11:45, desperation sets in and more than 60 labourers can be seen going from one contractor to another pleading for jobs with folded hands. Most end up agreeing to wages as low as Rs 150-Rs 200 while the official minimum wage is XXX. Finding 10-15 days of work a month has become a challenge while earlier 20 days was an easy target, we were told.
Before demonetisation, a skilled worker could earn Rs 400-Rs 550 a day and an unskilled one around Rs 300-Rs 350.
This is the seventh of an 11-part series (you can read the first part here, second here, third here, fourth here, fifth here and sixth here), reported from nationwide labour hubs--places where unskilled and semi-skilled workers gather to seek contract jobs--to track employment in India’s informal sector. This sector, which absorbs the country’s mass of illiterate, semi-educated and qualified-but-jobless people, employs 92% of India’s workforce, according to a 2016 International Labour Organization study that used government data.
By delving into the lives and hopes of informal workers, this series provides a reported perspective to ongoing national controversies over job losses after demonetisation and GST. The number of jobs declined by a third over four years to 2018, according to a survey by the All India Manufacturers’ Organisation, which polled 34,700 of its 300,000 member-units. In 2018 alone, 11 million jobs were lost, mostly in the unorganised rural sector, according to data from the Centre for Monitoring Indian Economy(CMIE), a consultancy.
Daily wages are up but few jobs
In 2017, the Shiromani Akali Dal (SAD) and Bharatiya Janata Party-led alliance was defeated by the Congress in Punjab’s state assembly elections. The disappointment with the SAD alliance was so acute that its seat count fell (XXX%) from 56 in the 2012 election to just 15 in 2017. Amarinder Singh, the new chief minister, came to power promising to address the two biggest issues plaguing the state: unemployment and drug use.
To tackle unemployment, the new government launched its flagship mission, Ghar Ghar Rozgar and Karobar Mission which promised at least one job per family. More than 550,000 youth have been offered jobs, the CM said at a job fair in Jalandhar XX.
From September 2017 to February 28, 2019, 37,542 youth have been employed with the government, the CM claimed. Around 171,000 had been placed with the private sector and around 365,000 helped under self-employment schemes through loans ranging from Rs 50,000 to Rs 100,000 at low interest rates.
The District Bureaus of Employment and Enterprises, established in September 2017 across all districts in Punjab, aimed at coordinating and implementing government employment schemes. The state would train 50,000 youth in the state under various skill development scheme in 2019-20, said Charanjit Singh Channi, minister of employment generation and technical education.
In February 2019, the state government signed an MoU to provide Punjabi youth with internationally-recognised training for jobs in the construction sector, which could help them secure jobs overseas. The MoU was signed between Maharaja Ranjit Singh Technical Education University, Bathinda, and ACES Skill Center. The programme included basic training in construction skills like carpentry and masonry work.
In 2018, the Congress-led state government fixed Rs 341.12 as minimum daily wage for semi-skilled labour, Rs 311.12 for an unskilled worker and Rs 375.62 for a skilled one. Most workers at the Gol Diggi told us that they are forced to settle for less. In 2016, just before demonetisation, minimum wages for a semi-skilled worker was lower, Rs 317.28.
However, labourers then earned more, anything between Rs 350-500 a day. Today, the rate for both skilled and unskilled workers has severely fallen, workers told us.
‘I get work maybe 10 days a month now’
Sixty-two-year-old Sachha Singh covers his faded pink turban with a shawl to protect himself from the glare as he waits to be picked for a job at Gol Diggi. In 2009, the uneducated labourer who was a private mason started to do daily wage work due to unavailability of jobs. He lives with his wife, son, daughter-in-law and two grandchildren in a compact one-room house in Lal Singh Nagar, about 5 km from Gol Diggi. While his house has access to electricity, residents in the area often complain about their water supply being contaminated by sewage water. He covers the distance by bicycle daily.
Demonetisation and its aftermath came a rude shock for Sachha and his family. Till then, he could earn upto Rs 500 for a day’s work earlier and found work at least 20 days a month. After November 2016, his wage fell to Rs 350, and then slid to Rs 250 by month-end.
The family runs on Singh’s salary of around Rs 3,500 a month and his son’s monthly earnings of of Rs 8,000 as a security guard at a local factory. “Soon after demonetisation there were days when I earned Rs 1,400 for the entire month,” he said.
The unemployment rate in Punjab in November 2016--when demonetisation was announced--was 4.9%, which increased to 6.1% in December, according to the CMIE. The unemployment rate reached 8.9% in June 2017 and further increased to 9.2% on the first anniversary of demonetisation in November 2017. In October 2018, the figure reached 11.7%, with February 2019 recording the highest rate, at 12.4%.
Demonetisation caused widespread panic not only amongst the working class, but even among industrialists across Punjab, said DP Maur, general secretary of the Joint Council of Trade Unions. At least 10,000-15,000 unskilled contract workers in Ludhiana--across industries that produce cycles, hosiery and auto parts among others--might have lost their jobs after demonetisation, he said. An exact figure of the number of jobs lost is hard to ascertain as Punjab’s industries primarily comprise unorganised workers, he said.
Different labour hub, same woes
After an entire day of waiting for odd jobs at the Railway Malgodaam labour market area of Mansa district in XX Punjab, Ram Singh, 67, just returns home with a few vegetables. Mansa is nearly 60 km from Bathinda and here too we heard the same stories of joblessness in the informal sector.
Lean and frail, Ram Singh is an illiterate worker who takes up jobs like cleaning, load carrying or helping masons and carpenters. Since 2008, he has been travelling 8 km by bus from his village, Nangal Kalan, to the labour hub, paying Rs 20 daily. He lives with his wife, son, daughter-in-law and two grandchildren in a small house. His son works as a contract labourer at a factory in Mansa, while his daughter-in-law works in a field as an agricultural labourer. Together, the family earns about Rs 11,000 every month, an amount not nearly enough to feed a family of six.
Wearing an off-white kurta and pyjama with worn-out black shoes, Ram discussed his financial troubles. Not only have they had to cut down on basic expenses, but the family has also had to reduce purchase of necessities like pulses. There were times immediately after demonetisation, Ram said, when he was able to find just two days work a month.
His average daily wage has also reduced from Rs 350 to less than Rs 230 now. The family’s reduced income has also affected the grandchildren, both of whom are in school. Ram could not afford to purchase the prescribed set of new books for his granddaughter’s school year and so she had to make do with her elder brother’s books the last two years.
The Malgodaam labour hub in Mansa is located close to the Mansa railway station, where nearly 100-150 daily wage labourers visit every day. Most are hired by private contractors for work like load picking, cleaning, and other small construction work. The area, being close to a railway station, witnesses heavy traffic. Before demonetization, about 150 labours would wait at the area for work. Immediately after the noteban, the number reduced to 50-60 and is gradually increasing again.
A local shoe market that primarily sells Punjabi juttis is often visited by labourers and locals XXX. Labourers start trickling in by 7 am and those who do not get work, wait till 11 am. Around 12:30 pm, a group of another 30-40 labourers visit the area for half day daily wage work. Contractors land up on bicycles to locate workers.
While unskilled workers seek basic jobs like cleaning and load carrying, the skilled labour who carry around their tools, are hired for skilled labour work. Every arrangement is only finalised after hard negotiations over wages.
Thirty-five-year-old Gora Singh, a Class 2 dropout, has problems similar to Ram Singh. “I have two children (both sons) who used to go to school, but now cannot as there is no work for me,” said Gora Singh, 35, a Class 2 dropout and unskilled worker. “I have no money to buy books or uniforms for my children.”
He has been visiting the labour hub since 2013. Before demonetisation, he managed to find more than 20 days work a month; today he is happy if he gets even two weeks. He earns about Rs 3,000 a month now and his wife earns Rs 3,500 working as a domestic helper. If it is month end and the family’s savings dip, he even settles for Rs 150 as daily wage. The family lives about 2 km from the labour hub in a small one-bedroom house paying Rs 800 as rent and he travels back and forth on foot daily.
Labour contractors took the noteban blow too
Labour contractors across the state’s job hubs are stressed too, we found. The wages have risen beyond pre-demonetisation rates and there are not enough workers across various sectors, they said. Since there are no fixed rates or wages, the cut taken by the labour contractor varies widely.
Jagtar Singh, 48, is a labour contractor from Mansa, who usually hires for the brick kilns in XX. The labour market has splintered post-demonetisation making it difficult for anyone with a stake in to survive, he said.
“A large number of workers who earlier worked as daily wagers have shifted to agricultural labour after demonetisation left them with no work,” he said. Though agricultural workers only get seasonal employment, currently there is perennial demand for them, Singh added.
Before demonetisation, Jagtar Singh, a Class 4 dropout, employed about 16 labourers (eight groups of husbands and wives) at a brick kiln, but now is left with only eight workers. Brick kilns have yet to recover from the shock dealt by demonetisation on the construction industry in Punjab. Jagtar Singh’s monthly income has fallen from Rs 34,000 to Rs 20,000.
Migrant workers get paid even less
A large chunk of the casual worker population--including migrants--in Punjab gets agricultural employment only for 50 days a year during wheat harvesting, paddy sowing and paddy harvesting seasons, as per Lakhwinder Singh, an economist at Punjabi University in Patiala.
Of all these tasks, only paddy sowing requires some prior experience or knowledge. So the agriculture sector tends to absorb the least skilled workers.
The brick kilns of Punjab also employ a large number of migrant workers. While local labourers know their rights, migrant workers are often paid less than the minimum wages, we found. The wage rate is usually fixed per 1000 bricks at kilns.
Jagtar employes both local and migrant workers. A couple could earn about Rs 10,000 a month before demonetisation; this is now down to Rs 7500, he said.
GST landed the next big blow
Medium and small enterprises in Punjab have been doubly affected by demonetisation and the Goods and Services Tax introduced in XXX. Cheap imports from China had already impacted these enterprises when demonetisation crippled them, said Badish Jindal, former vice chairman of National Productivity Council (NPC) and president of Federation of Punjab Small Industries Association.
“While demonetisation forced industrial units to lay off workers, the implementation of GST made them spend resources to understand these taxes and file them under the new regime,” he said.“Both demonetisation and GST did not go well for the cash economy.”
Rajinder Kumar, 40, is a cable operator in Mansa. He manages nearly 25,000 cable connections. While multinational companies were still able to decrease the price of DTH connections, Kumar said he had to suffer losses after the implementation of GST -- 18% in the case of operators like him. “After the implementation of GST, our cable connection became costlier by nearly by Rs 100,” he said. “People cut cable connections and opted for cheaper DTH links run by national giants.”
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