2018 Volume 73 Issue 1 Pages 1-20
This study aims to clarify the labor market structure for workers and their economic life in the automobile industries (including four-wheelers, two-wheelers, and components manufacturers) as well as light industries (including apparel, textiles, leather, and other handcraft industries) using field data collected by the authors from one village in the Industrial Model Township (IMT) of Manesar. IMT Manesar is the largest industrial estate in the state of Haryana and is well-known as one of the main vehicle production centers in the "auto corridor" of the National Capital Region (NCR) of Delhi. Furthermore, this industrial estate has also provided many plots for small-scale industries (SSI), including light industries. Therefore, a comparative study of the two industries' workforce was possible. The results of a survey of 294 respondents (automobile industries: 202, light industries: 92) reveal the following:
1) In the automobile industries, regular employees composed no more than 10% of the workforce, and most of workers were classified as non-regular. The gap between regular and non-regular employment is quite large in terms of wage level and employment security because the latter category is excluded from India's labor laws. In the light industries, about 30% of workers were under regular employment. However, most factories in the industries are categorized as SSI, which means that even regular employees are excluded from the application of labor laws. Therefore, classification of regular and non-regular employments is meaningless in the light industries.
2) Non-regular workers in the automobile industries and workers in the light industries were basically involved in the same labor market—the second labor market—because they shared commonalities in several aspects. Most workers originate from the "contract workers' belt," which spans from Uttar Pradesh to Bihar. Their monthly basic wage is determined by the state's minimum wage, which was INR. 7,600 in January 2016, at the time of the survey. Their actual monthly income was estimated at INR. 8,000–9,500, which was less than half that of regular workers in the automobile in the first labor market. Some differences can be seen in the second labor market. Automobile companies and their related contractors may have a labor policy to keep their workforce young, fresh, and cheap, which generates higher turnover of non-regular employees in the automobile industries compared with the light industries.
3) The workers in the second labor market spend only small amounts of their earnings on their daily needs. They share one small room with other workers to minimize housing costs and also cut down on food expenses. Then, they periodically remit their remaining salaries to their families. On average, 40% of their actual income is used for remittances. This money is spent not only on their families' daily expenses but also on education, purchasing durable goods, and other purposes, which might mitigate their socio-economic disadvantage. Focusing on the series of workers' employment and economic behavior, we can recognize that they are striving to take advantage of India's industrialization under the given conditions.