Center For Workers Education

for building a democratic labour movement in India

Why integrated labour law reforms is necessary to upgrade labour standards-8

Why such anti-labour policies?

The answer of government and the capital is that these policies will boost foreign investment, accelerate the growth and generate the employment.

But what is actually happening?

  • There is a boost in FDI and exceptionally high growth rate in the economy is achieved, but employment growth remains dismal
  • If we see the picture of growth: the share of agriculture in GDP decreased drastically, but the share of agriculture in employment still remains about 56 %. It means the economic growth is not creating enough employment and is largely coming out as job-less growth.
  • Employment grew at 1.84 per cent per annum during 1993-94/2004-05, as against 2.02 per cent in the preceding ten year period. During the period 2004-05/2009-10, employment growth, has been abysmally low, 0.22 per cent per annum. While GDP growth rate was about 5 per cent during 1983-84/1993-94, rose to about 6.3 per cent during 1993-94/2004-05 and accelerated to as high as 9 per cent during the period 2004-05/2009-10, when employment virtually stagnated.
  • It is interesting to note that from 1999-00 to 2004-05, the total employment in the economy increased from 397 million to 458 million. In organized/formal sector total employment increased only by 8.5 million during this whole period (from 54.1 million to 62.6 million), and moreover all this increase in employment in formal sector was also of informal kind. This was combined with informalization of existing employment in formal sector. It means the workers who were earlier in better conditions were also thrown in precarious working conditions and low wages
  • Between 2007 and 2011, labour productivity increased by 6.4 per cent on an average, while employment expanded by just 1.0 per cent. This situation is prominent in India, where total employment grew by only 0.1 per cent during five years till 2009-10 (from 457.9 million in 2004-05 to 458.4 million in 2009-10), while labour productivity grew by more than 34 per cent in total during this period.
  • The same period recorded a huge employment loss due to retrenchments and downsizing and during the period 1995-96 to 2000-01 about 1.1 million workers were thrown out of job

In this situation, if growth is not generating employment for the people, then who wants this faster economic growth? Which section it is targeted to benefit?

Is it justified to sacrifice the wellbeing of workers at people at large to benefit the corporate in the name of achieving faster economic growth?  Are the people not the nation?


(See T.S. Papola and Partha Pratim Sahu March 2012. GROWTH AND STRUCTURE OF EMPLOYMENT IN INDIA Long-Term and Post-Reform Performance and the Emerging Challenge; Institute for Studies in Industrial Development, New Delhi;  The Report on Conditions of Work and Promotion of Livelihoods in Unorganized Sector, National Commission for Enterprises in the Unorganized Sector, Government of India 2007; Bhattacherjee, D 1999.  Organized labour and economic liberalization India: Past, present and future; DP/105/1999 Labour and Society Programme, International Institute for Labour Studies Geneva; Jobless growth continues in India;


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