The daily wage rates of temporary workers have risen as a result of increased industrial activity and a smaller migrant workforce. After the reverse migration seen during the lockdown, industrial clusters are making do with just 80% of migrant workers returning. Regular wages have risen from nearly Rs 250 to Rs 350-400 as a result.
“Most former employees have returned,” said R Ramamoorthy, a Coimbatore-based MSME business owner and former president of the Coimbatore District Small Industries Association (CODISSIA), a confederation of small businesses. However, there is only a 20% disparity. This is because staff are aware of their demand and have relocated to other metros rather than returning to tier 1 and tier 2 cities.”
V N Sujeesh, an auto parts manufacturer in Ambattur (Chennai) with 50-70 employees, said migrant workers’ wages have increased by 25-30%, excluding housing. “On average, we now pay our qualified migrant laborers up to Rs 9,500 per month, except lodging costs. We’ve also added more foreign workers to our team. A few of them worked in tier-2 cities like Coimbatore in the tile and textile manufacturing industries and were laid off as a result of the pandemic, according to Sujeesh.
Orders are currently good, and the workforce has increased by more than 20% from its pre-Covid levels of 70-80 employees. “One of my former colleagues, who worked with us two years ago, has expressed an interest in returning right away because he is concerned that a second lockdown would be implemented. We’ve got applications from Maharashtra’s Nagpur as well as Kerala’s Kerala. “The lack of alternative income is becoming a growing concern among migrant workers,” he added.
Tiruppur is a city in the state of Tamil Nadu, India. “Previously, we would get migrant labor for an average wage of Rs 300 per day, which has now gone up to Rs 400-500 as of March 2021,” said Kesavar Senthil, owner of Mithra & Company, a premium sewing thread, and garment accessories manufacturer. Just a few of our employees had returned to their hometowns to celebrate Holi. They have confirmed that they will return in June,” he added.
In tier-2 cities, there is now a 20-30% shortage of skilled laborers, compared to a 10% rise in the labor force recorded by metro cities. “Wages were stunted in 2020 due to the pandemic,” said Yeshab Giri, director of staffing at Randstad India. “Prior to that, in 2018, the western region saw a significant increase in worker salaries, which in Maharashtra more than doubled to Rs 12,000 per month. For a few years, minimum wages had not been changed. As a result, there was an abrupt shift. But it has been rising at an annual rate of 8-10% since then.”
While growth in some sectors, such as auto ancillary, has slowed since the pandemic, FMCG and logistics have performed well. “There is still a demand-supply gap with reverse migration, and wage growth is steadily returning to pre-Covid levels,” he said. “With the economy projected to pick up, wage growth in 2021 may be 7-10 percent,” he said.