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Posco exaggerated plant’s job potential by Nitin Sethi


Did Posco exaggerate the employment potential of its Rs 50,000 crore plant in Orissa? A group of US-based experts has accused the Korean steel giant and Orissa of fudging statistics on potential jobs to hardsell the integrated steel plant.

A paper prepared by Mining Zone Peoples' Solidarity Group — a collection of economic professors and engineers and others based in the US — has unravelled the figures estimated in an NCAER report that Posco funded to find that the project at best will bring only 17,000 jobs in the first year and not more than 50,000 jobs for the state with 9.9 lakh unemployed.

Posco had claimed that its project in Jagatsinghpura would bring unemployment down from 9.9 lakh to a mere 1.2 lakh.

The paper states that, "The employment potential of the project has been grossly exaggerated by Posco and Orissa government, based on an inaccurate study by NCAER. A careful breakdown of the much touted '8.7 lakh man years of employment for 30 years' claimed by the NCAER study shows only 7,000 direct jobs and a maximum of 17,000 direct and indirect jobs in the next 5-10 years."

The paper states that this would mean only a "maximum of 1.7% reduction in current unemployment levels as against the exaggerated claims by Posco".

Their evaluation of the NCAER study and Posco's claims shows that even when the plant is running at its full capacity 1-30 years from when it starts construction it will only provide 48,000 jobs which is still just 4.7% of current unemployment. That too if one assumes that the number of unemployed remain static in time and doesn't increase with time and population.

The experts point out that even these figures are optimistic. They say trends in the steel and mining sector show that with increased mechanization and efficiency the labour hired for every tonne of steel produced has been falling in the state.