The economic downturn has hit jobs in the small and medium enterprises too. SMEs in Kanpur may be forced to lay off a substantial portion of their workforce..
Most units in the city are resorting to reduction in the workforce as an integral part of measures to counter the declining business and increasing production costs.
“We are being forced to reduce the number of working hands as orders have declined sharply in past few months. We can not pay idle men,” said Ram Singh, who runs a pan masala manufacturing unit in DadaNagar.
Around 2,500 city units employ 100,000 people in the city,. Of these, 65,000 work in Dadanagar, Panki and Fazalganj, while around 25, 000 work in Jajmau and other leather related works.
There are 10,000 temporary and contract workers. “If the situation persists, the axing of more employees cannot be ruled out,” said Ravindra Pandey, managing director, Supreme plastic furniture.
“Almost 2,500 workers have lost their jobs in past two months due to low demand and production. If the workforce is reduced further, contract-based workers will be first to be evicted. We are still waiting for situation to improve before taking further steps,” said Mukhtar-Ul-Amin, chairman, Council for Leather Export.
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Provincial Industries Association member Mikki Manchanda also confirms that job cuts are being resorted to. “Almost half of the Small Scale Industries (SSIs) have already closed down or are poised to follow suit,” he said.
According to Indian Industries Association (IIA) state president, Praveen Sadana, around 4 million jobs across the state were in danger due to the slowdown. The stock broking firms of the city are one of the worst-hit business units as they are experiencing heavy reduction in customers.
“Investors in the city have lost around Rs 100 crore due to the fall in the Sensex. They are now not willing to come forward,” said Padam Kumar Jain, chairman, SPFL.
The 300 small and medium stock broking firms in the city have been left with little option but to reduce the workforce. “Around 500 employees are likely to be jobless business has reduced to 20 per cent,” he added. Private banks and insurance companies also plan job cuts.
The plastic, auto ancillary, handicrafts and textile have also been badly hit. “The footwear and garments production of the city has reduced by 60 per cent and export orders are declining phenomenally. In such a scenario, how can one pay wages to idle employees,” says Sunil Vaishya, Kanpur chapter, IIA president.