Precarious employment

Omicron has increased livelihood concerns

Concerns have begun to grow about the impact of the current wave of the pandemic on livelihoods in India. The Omicron variant, which is highly transmissible but appears to be relatively mild in terms of fatalities, has nevertheless led to reduced mobility and increased public health-related restrictions on economic activities. Not all these restrictions make sense — night-time curfews, for example, have no logical or real-world link to controlling the spread of Omicron. Yet it is not surprising that some of those with precarious livelihoods, including in the hospitality and other service industries, are already suffering — and that others are increasingly concerned about the effect of another pandemic wave on their lives.

For the government, there are no good options in this situation. The incomplete nature of India’s social support net has been thoroughly exposed by the pandemic, and it is unfortunate that there have been few attempts to improve coverage in the past two years. It is to be hoped that rumours and fear do not once again lead to unfortunate scenes, such as those observed following the initial national lockdown, of migrant workers streaming home. This would compound the humanitarian disaster and also put yet more pressure on small and medium enterprises that are struggling to stay afloat.
 

The longer-term solution has to be reliable employment that reduces the precariousness currently felt by most individuals in India’s job market. But, as Business Standard columnist Mahesh Vyas has repeatedly pointed out, India’s employment rate is much lower than global standards. While the global rate is 55-58 per cent, in India it is 43 per cent, according to the World Bank, and 38 per cent, according to the Centre for Monitoring Indian Economy. This is far too low to be sustainable. One problem is that jobs are believed to be either so difficult to find or so unattractive that too few young people, particularly young females, are willing to look for jobs actively. Another problem is that mobility is disincentivised, meaning that areas with a surplus of unemployed or underemployed individuals are not exporting them to areas where additional jobs are being created. This lack of mobility has been, of course, made worse by the initial lockdown during which migrants were seen as suffering the most.

The government will naturally have to re-examine its portfolio of short-term palliatives — some cash payouts and free grain supply, the expanded rural employment guarantee, financial relief to smaller enterprises, the payment of school fees up to a limit, and so on. Some of these might need to be extended in the context of the new wave. Yet there is no alternative to putting in place the machinery required for longer-term solutions. These are now well understood. First: Improvement of the social security net, including the ability to more directly and effectively target vulnerable segments of the population. Second, more protection for migrant workers, as well as removing the disincentives to migrate. Third, upskilling of individual workers so that they are able to access more and better jobs. And fourth, ensuring that women’s safety and status improves so that they are more likely to enter the workforce.