As the economic recession in the developed world is eliciting calls for companies to sack migrant workers first and retain locals, the UPA government has woken up to the potential threat of the global financial crisis to India?s precarious labour market.
For the first time since Lehman Brothers? implosion on September 15, 2008, the Centre will take stock of the implications of the global financial meltdown on Indian workers? employment conditions as well as issues related to migrant workers at a two-day meeting with employee unions and employer representatives in the third week of February.
The manifestations of the global financial crisis on the job market, such as ?large-scale downsizing?, ?layoffs?, ?wage cuts? and ?job losses? dominate the agenda for the 42 nd session of the tripartite Indian Labour Conference. With Prime Minister Manmohan Singh recuperating from his recent multiple bypass heart surgery, the conference will be inaugurated by external affairs minister Pranab Mukherjee on February 20 in the Capital.
Along with the global financial crisis? impact on jobs, issues related to migrant workers and contractualisation of labour also figure prominently on the conference agenda. Demand slowdown in developed countries has already hit jobs or working conditions across several export-related, employment-intensive sectors like gems & jewellery, leather, carpets, handlooms and marine products.
Though the first two fiscal stimulus packages announced by the Centre in the last two months have sought to allay the lot of exporters and ease up credit to industry, there have been no direct steps taken to address the prospect of job losses or adverse changes in working conditions, like longer working hours and/or lower salaries.
The textile ministry has estimated that job losses in that sector alone could add up to 5,00,000 by March 2009, but beyond that, there has been little assessment of ground realities by policy makers. While unveiling the January-2 stimulus package, Planning Commission deputy chairman Montek Singh Ahluwalia admitted that the government has no mechanism to ascertain or verify employment creation or shrinkage trends on a monthly basis.
With global corporations announcing plans to downsize their employee strengths significantly, developed countries have begun responding with xenophobia. Microsoft Corporation, which announced plans to slash 5,000 jobs last week, has been told by Iowa Senator Charles Grassley to ensure that ?Americans are given priority in job retention.? ?During a layoff, companies should not be retaining H-1B or other work visa programme employees? over US workers, Grassley wrote in an open letter to Microsoft CEO Steve Ballmer. Meanwhile, the Saudi Arabian kingdom has asked all companies in trouble to ?start with foreigners first, if they have to sack staff.?
If migrant workers lose their jobs, not only will it hit their lucrative forex remittances, which have boosted India?s reserves in recent years, but also trigger an exodus back home, adding to the labour supply in the domestic market.