Bihar Migration down 30%, causing labour shortages elsewhere: Why?
New Delhi: a number of reports in recent times have focused on Bihar’s growth story for an interesting reason – not to sing the Bihar success story all over again but to go into some details of its ripples felt in other parts of the country. One major unintended consequence of Bihar’s growth is shortage of labour of many types and skill levels in distant Bangalore, Surat or Punjab. The reason for this is the habitual Bihari migrant is now showing reluctance to move out of the state. As part of the ongoing trend, a recent report mentions how Bihar’s recent economic growth has created a peculiar problem for real estate and infrastructure firms in other parts of the country.
Quoting figures, the reports mention that migrant labour from the state constitutes around 50% of the unskilled workers employed in these sectors nationally, but increased government expenditure and private investment has caused rural migration from Bihar to fall by a third in recent years, resulting in labour shortages and 35-50% higher wage bills for real estate firms.
Ajay Chandra, managing director of Unitech, one of the country’s top three real estate companies told a correspondent ‘There is a huge shortage of labour and that is leading to higher cost of construction as well as project delays’. It seems the company with a number of projects in hand is having a tough time juggling labour between the different sites – a sure sign that labour supply is no longer abundant.
Traditionally known for stagnation, in the past Bihar proved to be a rich source of labour for the well-known investment destination like Maharashtra, Gujarat, Tamil Nadu and even neighbouring Uttar Pradesh. But part of Nitish Kumar government’s Sushasan [good governance] is the state’s economic policies since 2005, showing a massive growth in government expenditure, a big part of which is going into infrastructure and construction. To illustrate the point, the budget plan expenditure for Bihar this year is Rs 24,000 crore, up from Rs 18,000 crore last year, much of which is being spent on building roads, hospitals, and schools.
With construction in the state growing at a 20% year-on-year rates, and with the government’s insistence on the minimum wage rules being followed, the likely migrant will seriously debate before departing for Mumbai or Bangalore.
Unless of course, the wages at those destinations compare well with what the labour makes at home, not to mention the comparative living expenses and the emotional factor!
[Courtesy: The Economic Times]