ILO Wage Report Paints a Sorry Picture of Economic Inequalities in India -Anumeha Yadav

-TheWire.in

Real average daily wages improved between 1993-94 and 2011-12, but gains of growth have bypassed casual workers, women and rural areas.

Over the past two decades, India became one of the two fastest growing economies in the world, alongside China. The gross domestic product (GDP) has risen four folds since 1993. But has this growth been distributed to lower economic inequality? Has the increase in wages matched the pace of growth in productivity?

While real average wages nearly doubled between 1993-94 and 2011-12, the economic liberalisation policies in 1991 have produced a low wage economy with sharp inequalities shaped by gender and other social characteristics for most Indian workers, shows the India Wage Report, an International Labour Organization publication released on Monday which has analysed the most recent government data on wages.

In 2011-12, the most recent year for which the government of India has made wage data from a nationally representative survey available (the national Employment and Unemployment Survey set to take place in 2016-17 after five years was not undertaken, and has since been discontinued), more than half, 62% of wage earners in India were employed as casual workers, and got only 36% of the compensation received by regular or salaried workers.

Urban workers earned 2.2 times more than workers in rural areas. A regular or salaried worker in the organised sector earned 3.7 times more than a casual worker in the same sector, even if they did the same economic activity, shows the report.

Because of gender-based disparities, women earned 22 to 39% less than men across different categories of location and status of employment. Overall, the gender wage gap reduced from 48% to 34% largely due to the implementation of the Mahatma Gandhi National Employment Guarantee Act, found the researchers. But India’s gender wage gap is quite high at 34% compared to the global average of 23% in 2015.

Women casual workers earned the lowest real average wages across all categories. Among casual women workers, Dalit and other backward class women earned slightly higher than those from the general and adivasi categories in both rural and urban areas. But even they earned only 22% of what urban regular workers earned on an average.

Overall, in the years of highest growth, the labour share, that is proportion of national income going to labour compensation as opposed to capital or landowners, declined from 38.5% in 1981 to 35.4% in 2013. Labour productivity, or the GDP per worker, increased, but the gains in labour productivity were not passed on to workers in the form of wage increases, finds the study.

Please click here to read more.