The Economy of India’s Migrant Labour Market

By Arka Chaudhuri

400 million Indians work as migrants in other states which provide more job prospects than their home state. Thus, approximately a whopping 26% of the Indian population are migrants, living far from their home states in search of better economic conditions. This population originates majorly from states like Odisha, Uttar Pradesh, Jharkhand, and Chhattisgarh where the indigenous populations’ resources are exploited by outsiders. Most of these workers are attracted to big business centres like Mumbai and Delhi making labour cost dirt cheap in these cities as a large part of this migrant population work in the labour industry, working in factories or construction sites.  

When the Indian government issues a lockdown in March of 2020, we saw tens of millions of migrant labourers fleeing from the state they work in back to their home states in a sort of a mass exodus. The states in which they work are generally more expensive to live in than their home states which are usually less developed states. The closing of construction sites and factories meant the loss of income for this group of society. For them, surviving in an expensive state without a source of income was impossible and hence the only solution was to flee to their home state to wait out the outbreak. Due to the closing of major transport lines like the train lines by the government to reduce corona virus cases, this part of the society was forced to make the journey on foot or other odd transport systems. Making a 1000km journey on foot with almost all your belongings isn’t easy, especially in a time of food shortage. So, most of these migrant labourers took this journey in the blazing heat of the summer with very little money and hence very little food. Social Distancing was not possible for these migrant labourers who stated that they would rather die of the virus in their villages then die of hunger in the big cities. So, the Indian Migrant Labour Crisis is a story of unpreparedness and miscalculation of the government when deciding the fate of this humongous yet voiceless portion of the Indian Population. 

Being a job holder has several benefits besides just the monthly paycheck, like a social security framework and job security. The Indian law that any individual who is a paid labour of an organization for more than 90 days must be employed by the organization, but like everything else, construction contractors and factories work around this by employing them on a daily wage for 89 days before not giving them work for a day. This prevents them from being obliged to employ the worker. This also means that they are not obliged to giving the workers health benefits and other such perks that come with holding a job. This also prevents the governments from quantifying this population or even reach them. Therefore, it is hard to make any real regulations or reforms aimed at this part of society because of the lack of robust data when it comes to this industry and its numbers. Therefore, the number stated at the start of the article, i.e., 26% of India’s population works in this informal job sector, some studies suggest numbers as high as 90%.  However, underestimating the countries labour force was not the only reason for this crisis. The food shortage the country was facing at the time was another factor that made the migrant worker’s journey even worse. However, the food corporation of India stated that it has enough grains to feed the whole population for a year and a half. It also promised to give rations to the unemployed workforce, these workers were stranded on foreign soil. Again the “one country, one ration card” system existed, yet it was not well enforced in most states and most labourers stated they were not aware of this scheme.

To sum it up, the migrant labour crisis that took place in India stretching from May 2020 and still has not completely flattened down, killing more than 196 people*, has fascinating and frightening economics behind it. Mismanagement of resources of the Government and a hastened and unprepared lockdown are mainly to blame, but whatever be the cause, fixing the migrant labour crisis is an urgent need for India. After being faced with the near-death situation during this tumultuous year, the traumatized labourers might decide to stay back in their villages in fear of being stranded again. Thus, helping the migrant labourers is not a matter of charity but rather a matter of sustainable economic development, because if what is stated were to happen, the cheap labour which was fuelling the growth of big Indian cities like Mumbai and Delhi might be lost.

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