The latest Annual Survey of Industries (ASI) estimated workers employed in factories at 9.2 million in 2009-10. About 3 million of these are employed in rural areas and 5.3 million in urban areas. ASI covers all factories registered under Sections 2m(i) and 2m(ii) of the Factories Act, 1948, that is factories that employ 10 or more workers using power and 20 or more workers without using power. This includes the manufacturing sector and some service activities like waste collection, treatment and disposal, publishing and so on. Workers form around 78 per cent of the total people employed in factories, and a job in a factory has always been one of the most coveted livelihood options.
Overall, the average annual wages of workers rose from Rs 46,054 in 2001-02 to Rs 75,277 in 2009-10. But except in 2007-08, the annual increase has not matched the rise in prices. In 2007-08, workers reaped the benefits of high growth when skills shortage plagued the booming economy. Of course, wages of workers vary depending on the sector. Factories making tobacco products have the lowest wages per worker (Rs 25,415 per annum), while the coke and refined petrochemicals sector pays the most (Rs 186,635 per annum). There are eight sectors in which the average annual wage of workers exceeds a lakh — coke and refined petroleum products, repair and installation of machinery and equipment, computer, electronic and optical products, machinery and equipment, publishing activities, motor vehicles, trailers and semi-trailers, other transport equipment and basic metals.
A state-wise analysis shows that Tamil Nadu has the highest number of factory workers, followed by Maharashtra, Andhra Pradesh and Gujarat. The most populous state, Uttar Pradesh, comes fifth, reflecting the structure of the state’s economy. (Click here for chart)
| PAY CHECK The annual increase has not matched the rise in prices | |||
| Annual wages per worker (Rs) | Annual growth in per worker wages (%) | CPI IW average inflation (%) | |
| 2001-02 | 46,054 | 2.10 | 4.30 |
| 2002-03 | 48,185 | 4.60 | 4.00 |
| 2003-04 | 50,071 | 3.90 | 3.90 |
| 2004-05 | 50,968 | 1.80 | 3.80 |
| 2005-06 | 52,779 | 3.60 | 4.40 |
| 2006-07 | 56,203 | 6.50 | 6.70 |
| 2007-08 | 62,246 | 10.80 | 6.20 |
| 2008-09 | 68,103 | 9.40 | 9.10 |
| 2009-10 | 75,277 | 10.50 | 12.30 |
| Source: ASI, Labour Bureau | |||
When it comes to the average annual wage for workers, Maharashtra outstrips Tamil Nadu, and Gujarat has higher levels than Andhra Pradesh. Part of the disparity in income can be attributed to the cost of living. But since there are wide sector-wise variations in the average wages, the structure of industry in a state also yields different opportunities for workers. That is why when it comes to the average annual wage per worker, Jharkhand with its coke manufacturing comes at the top of the table with Rs 149,931, followed by Goa and Maharashtra. Manipur, Tripura and Nagaland come at the bottom with less than Rs 35,000 and Meghalaya with its cement factories has a higher average wage than West Bengal.
The overall wage bill may rise next year as states have agreed to a national minimum wage floor that can boost earnings for workers in the lowest grade. However, the issue is again of implementation. For example, Uttarakhand drew a good response to their tax incentive scheme, but there were more than a thousand cases of wage and benefit violations registered last year. As industry faces slow growth and high input price inflation, it is workers who continue to take the brunt of fewer opportunities and high consumer inflation.
Indian States Development Scorecard, a weekly feature by Indicus Analytics, focuses on the progress in India and across the states across various socio-economic parameters.
sumita@indicus.net