With 100 days of work assured to unskilled workers under the National Rural Employment Guarantee Programme (NREGP), the labour supply to Micro, Small and Medium Enterprises (MSMEs) in the state has been impacted.
Though the degree of impact is yet to be assessed, industry insiders estimate the shortage at 10-15 per cent, depending on the nature of the unit.
While agro-based units have been relatively more affected, pipe manufacturing, common quarrying and garment manufacturing units have been affected to some extent.
“The diversion of labour from small-scale units to NREGP work is affecting the small-scale units very badly. They faced some shortage of labour when the daily minimum wage for unskilled workers was Rs 70 per day, but the problem has been aggravated by the revision of the minimum wage to Rs 90,” Niranjan Mohanty, president of the Utkal Chamber of Commerce and Industry (UCCI), said.
He added that the NREGP programme should engage unskilled and unemployed workers. The diversion of labour from small-scale units to NREGP works has impacted all small units to some degree, as they employ labour for work like loading and unloading of raw material and finished goods.
Apart from agro-based units which employ a major chunk of unskilled labour, the garment making sector has also been affected. With the gap between the prevailing industrial wage and NREGP wage vanishing, the temptation of migrating to NREGP work, which is less taxing than industrial work, has grown.
“With Rs 100 as wage and 25 kg of rice available for them every month at Rs 2 per kg under the government’s food subsidy programme, labour is not interested in working in small-scale units. So the sectors which employ unskilled and low-skilled labour are facing labour shortages,” Mohanty added.
Though the small units look for people in the age group 20-45 years, they are not available, forcing industries to engage labour from higher age brackets.
About 10-20 per cent of the labour shortage is experienced by units in the iron and steel, wielding, machine-making, transformer manufacturing, iron pipe and plastic pipe industries and warehouses.
“It becomes very difficult to arrange accommodation for labour, given the high rents prevailing in the cities and towns. We, the plastic pipe manufactures, manage the situation with great difficulty during the business season starting October till May end”, Ahmed added.
However, Bibhuti Mohapatra, president of the Orissa Small Industries Association (OSIA), noted that SMEs that mostly recruited skilled manpower were not facing as much of a shortage as a result of the diversion of labour to NREGP work.
While NREGP work attracts uneducated and unskilled labour, MSMEs are recruiting matriculates having an ITI or diploma qualification.
Besides, students doing courses at the ITIs in the state come for apprenticeships with MSMEs for about two or three months. Even the recruitment of skilled manpower from Kolkata has stopped due to the availability of skilled manpower within Orissa.
Hemanta Sharma, director (industries), Orissa government, said the problem is not acute in any SME sector yet, adding, “Some construction contractors may be facing a labour shortage due to NREGP work.”
