5 lakh jobs lost in three months Official figures reveal India toll
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- Published 4.02.09
New Delhi, Feb. 4: Official figures have confirmed the fears.
The global meltdown and the consequent slowdown in the Indian economy took 5 lakh workers off factory floors in the last three months of 2008, the labour bureau announced today after a study that covered 2,581 units.
Various job loss estimates — most painting a grim picture — had been doing the rounds but this is the first government study that has put a figure to the fear stalking the working population in the country.
The study reveals that between October and December last year, 5 lakh workers have lost jobs in sectors like textile and garment, metals and metal products, automobiles, gems and jewellery, transportation, construction and mining industries.
However, according to the study, IT and BPO increased employment rate marginally by 0.33 per cent, which does not match popular perception. As the entire sample covered 2,581 units, the number of IT companies could not have been too high and the finding is unlikely to mirror the full picture.
The findings were thrown up by the first such survey conducted by the bureau, which is part of the labour and employment ministry.
“The ministry took a serious note of the economic slowdown and it felt the need to have an assessment of its impact on employment to enable the government to take preventive and ameliorative measures,” labour and employment secretary Sudha Pillai said.
The three-month fall translates to 3.08 per cent — not very high compared with the 8-10 per cent plunge in some western countries. However, 5 lakh people are not a negligible number, not to mention the cumulative effect on their families and the fact that many factories (the country has 63 lakh industrial units) had not been covered by the government study.
The data also comes at a time the UPA government is preparing to go to elections on the plank of delivering on its promises to the aam aadmi. Most of the job losses have been in sectors where common people work.
The biggest knock has been taken by the export-driven gems and jewellery units — a fallout of the slump in demand from foreign countries that are reeling under the impact of the downturn. The impact of retrenchment is already becoming evident in Gujarat, which has a large number of gem and jewellery units, where suicides have been reported.
The automobile sector has also suffered badly, coinciding with poor demand in the last months of 2008. Demand, however, showed some stirrings of life in January.
Vishnu Mathur, the executive director of the Auto Component Manufacturers Association (Acma), said: “The impact will be more on component manufacturers which have been heavily dependent on supplying to the commercial vehicle sector. However, it is just a passing phase.”
Analysts and officials said the economy would improve from the second half of this calendar year.
Professor N.R. Bhanumurthy of the Institute of Economic Growth said: “Much will depend on the effectiveness of the fiscal stimulus packages announced by the government and loosening of the monetary policy. The government will have to take more steps to boost demand.”