Migrant workers have returned to India’s cities – but they are even more vulnerable now

As the job market shrinks, a labour surplus exerts downward pressure on wages and working conditions, making jobs more informal.

Annette Francis & Medha Uniyal-Jan. 2, 2021

Seema Kumar, a young beautician has just returned to Hyderabad after eight months of working on farms in her village. She was among the estimated 121 million people in India who lost their jobs after when the country went into a lockdown in March to contain the spread of the coronavirus

But unlike her usual city woes of searching for a hostel or negotiating shift timings, this time her worries are different. Kumar has come back to work at the same salon that employed her for the last three years without the commitment of a fixed wage. Instead of her usual monthly salary of Rs 8,500, Kumar has been informed that she will be paid only for her days of “productive” work: the weekends, festivals and other days of high demand.

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Despite the anxieties, Kumar knows that she was one of eight women who worked at the salon before the lockdown, and now is one of the only two “senior” beauty therapists who have been asked to rejoin.

Kumar’s experience of finding little employer-provided-security is not atypical.

A recently concluded survey of more than 1,600 large service-sector and manufacturing employers by the non-profit Pratham Institute indicates that the headlines of workers being provided flight tickets and red-carpet welcomes to return to their jobs don’t tell the full story story. In the aftermath of the pandemic, workers vulnerabilities have only been exacerbated.

Pre-lockdown vulnerabilities

Workers in India were already accustomed to not having regular sources of income. Less than 20% of the workforce employed in salaried jobs. The numerous rural-urban corridors of internal migration across the country are an outcome of the expectation that income opportunities exist, whether regular or not, albeit concentrated around urban areas.

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Of the 400 million people in the Indian workforce, 81% were engaged in the informal sector. When the lockdown was imposed, their livelihoods went for a toss. The images of migrants walking home when the lockdown was imposed were widely circulated and are difficult to forget.

Yet, as early as August, an estimated two-thirds of migrant workers indicated a desire to return to cities. The unwavered affinity for urban employment has been cemented by a lack of opportunities in rural areas and unstable agrarian incomes, forcing many into debt. However, as workers return to towns and cities, the opportunities they find for themselves have changed.

Migrant workers were a vulnerable even before the lockdown. Photo credit: PTI

Healthcare at the frontline of jobs

Healthcare hiring, at the entry-level for support staff, saw a dip at the beginning of the pandemic as hospitals and the industry at large worked to reconfigure operational norms. After a lull in April and May, private-sector recruitment resumed to pre-lockdown levels of hiring. Over 51% of the surveyed employers have now increased hiring, beyond the pre-pandemic levels.

For entry-level staff (0 to 2 years of experience), wages have remained almost the same: about Rs 7,500 at hospitals and Rs 10,000 at homecare agencies. There has been no increase in wages and a negligible improvement in benefits, including housing and transportation. But working hours have seen a jump as have general risks associated with the job, which remain uncompensated for.

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Plummet in service sector recruitment offerings

The service industry has a long road to recovery. In tourism, of the 1,176 hotels surveyed, only 45% are functioning while many of the rest have shut operations. Further, only 5% of the all surveyed hotels have commenced hiring. However, almost all are doing so at a significantly reduced capacity.

The beauty and wellness sector witnessed a similar hit in job opportunities, with only 28% of surveyed employers looking to recruit and almost all at a rate much lower than in previous years. Expectedly, these sectors have shown a marked decline in wages offered. The average entry-level salaries have reduced from Rs 5,860 to Rs 4,800 – a 15% fall since pre-lockdown levels. Patterns of informalisation, as experienced by Seema, have also been observed.

Temporary premium in manufacturing jobs

While manufacturing units are yet to reach the previous production scale, recruitment has seen a return, with 51% of the 156 industry respondents hiring at an increased scale compared to pre-lockdown levels, and 29% hiring at the same scale as before.

An average monthly salary premium of Rs 500 (8%) has been observed. This premium is higher, at around Rs 1,000 per month, in some manufacturing hubs like Pune and Noida, which face a more acute labour shortage. Further, a slight increase in additional benefits, like transportation, food and accommodation can be seen. However, employers seem to be keen on providing these benefits informally (non-contractually), or through short-term contracts – indicating that these are likely temporary changes.

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The young are the worst hit

While the pandemic’s health consequences have been most dire for older populations, its economic reverberations have hit the young worst. It is estimated that nearly 21 million salaried jobs were lost between April and August, with a higher proportion of this loss for those under the age of 40 years.

International Labour Organisation indicates that, across the world, one in six youth have stopped working since the onset of the crisis. The pandemic was a litmus test for India’s economic resilience and has exposed the gaps that we cannot un-see.

As the economy reopens, two shifts are already apparent. First, multi-skilled and experienced workers receive recruitment preferences over younger, inexperienced workers. Second, as the job market shrinks, a labour surplus exerts downward pressure on wages and working conditions, making jobs more informal and workers more vulnerable. This can hardly bode well for the country with the youngest and largest workforce in the world.

The government has moved quickly to announce skill development initiatives for migrant workers. However, without addressing the multi-dimensional precariousness caused by the lack of social security entitlements, financial inclusion and hands-on skills, economic vulnerabilities will continue to plague the millions who enter the Indian workforce.

Annette Francis and Medha Uniyal work on workforce development at Pratham, a non-profit.