Wednesday, July 17, 2013

Rate of growth of real wages of rural workers in Gujarat slower than most states, suggests study by ex-ILO scholar

By Rajiv Shah
Close on the heels of the latest National Sample Survey Organization (NSSO) data having revealed that average wages paid both in organized and unorganized sectors in Gujarat are one of the lowest in the country (click HERE for the report), a new study has found that the rise wages in the state has remained dormant for nearly a decade. Carried out by AV Jose, formerly with the International Labour Organisation's permanent secretariat in Geneva, and now associated with the Centre for Development Studies, Thiruvananthapuram, the study, titled “Changes in Wages and Earnings of Rural Labourers” has found that an average male worker in Gujarat who earned Rs 100 in 2001, earned Rs 114 in 2010, while the average female worker who earned Rs 100 in 2001, earned Rs 119 in 2010.
Significantly, the comparative figures the top scholar has culled out for the country as a whole suggest that the average male worker who earned Rs 100 in 2001, earned Rs 132 per cent in 2010, and the average female worker who earned Rs 100 in 2001, earned Rs 139 in 2010. For the sake of calculating the real wages, Jose has considered 1999-2000 as the base year with the nominal value of Rs 100, and indices have in turn been divided by the corresponding Consumer Price Index Numbers for Agricultural Labourers (ALCPI), in order to derive the index numbers of real wages. This has helped him show how much has the actual purchasing power of the wage earners in the country’s rural areas have risen.
The scholar’s calculations also show that the per annum rate of growth of the real wages in Gujarat has gone down over the decade under study. Thus, it was 3.54 per cent per annum rise for male workers and 2.69 per cent rise for female workers between 1988 and 2000. However, the respective figures for the decade that followed, 2001-2010, are 1.37 per cent for male workers and 1.74 per cent for female workers. The all-India figures suggest an opposite trend. The female workers’ wages rose in the country as a whole by 2.11 per cent during 1988-2000, and the male workers’ wages in the country rose by 2.68 per cent during this period. As against this, in the next decade, 2001-2010, the male workers’ wages rose by 2.82 per cent and female workers’ wages rose by 3.31 per cent.
No doubt, Jose’s calculations suggest that the female workers’ wages rose at a higher rate -- both in Gujarat and in India -- than male workers’ wages. But this is because there has been a concerted effort to bring a parity between male and female wages across the country, and there was a greater awareness on this score, too. However, the scholar underlines, “Workers in many of the low wage states, in particular the women workers, experienced faster rates of growth in real wages. Such differential growth has probably led to greater divergence of wages as indicated by the standard deviation values among those states. Nonetheless, these changes have not been sufficient to bring about any perceptible decline in wage disparities between men and women in rural areas.”
Ranking the 14 states which he has taken for his analysis for wages, the scholar has found that for male workers Gujarat ranked 11th and 8th for female workers in the year 2010. The ranking on both these scores for Gujarat has gone down -- it was 8th for male workers and 6th for female workers in 2001. Kerala was found to be the top ranking state whether it was 2001 or 2010. The scholar says, “The top five states in terms of wage rates for men – Kerala, Haryana, Punjab, Tamil Nadu and Rajasthan – have kept their positions among themselves more or less intact. At the other end, with lower wages from the bottom are Madhya Pradesh, Odisha, Bihar, Maharashtra, and intermittently Gujarat and West Bengal. Andhra Pradesh remains an exception among the states for having climbed out of the low wage group for men and women over the years.” 

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