Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 150
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Code Context


        trigger_error($message, E_USER_DEPRECATED);

    }
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 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php.'
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deprecationWarning - CORE/src/Core/functions.php, line 311
Cake\Http\ServerRequest::offsetGet() - CORE/src/Http/ServerRequest.php, line 2421
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Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Http\Runner::run() - CORE/src/Http/Runner.php, line 51
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Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 151
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Code Context


        trigger_error($message, E_USER_DEPRECATED);

    }
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 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php.'
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deprecationWarning - CORE/src/Core/functions.php, line 311
Cake\Http\ServerRequest::offsetGet() - CORE/src/Http/ServerRequest.php, line 2421
App\Controller\ArtileDetailController::index() - APP/Controller/ArtileDetailController.php, line 151
Cake\Controller\Controller::invokeAction() - CORE/src/Controller/Controller.php, line 610
Cake\Http\ActionDispatcher::_invoke() - CORE/src/Http/ActionDispatcher.php, line 120
Cake\Http\ActionDispatcher::dispatch() - CORE/src/Http/ActionDispatcher.php, line 94
Cake\Http\BaseApplication::__invoke() - CORE/src/Http/BaseApplication.php, line 235
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Routing\Middleware\RoutingMiddleware::__invoke() - CORE/src/Routing/Middleware/RoutingMiddleware.php, line 162
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Routing\Middleware\AssetMiddleware::__invoke() - CORE/src/Routing/Middleware/AssetMiddleware.php, line 97
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Error\Middleware\ErrorHandlerMiddleware::__invoke() - CORE/src/Error/Middleware/ErrorHandlerMiddleware.php, line 96
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Http\Runner::run() - CORE/src/Http/Runner.php, line 51
Cake\Http\Server::run() - CORE/src/Http/Server.php, line 98

Warning (512): Unable to emit headers. Headers sent in file=/home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php line=853 [CORE/src/Http/ResponseEmitter.php, line 48]
Code Context
            if (Configure::read('debug')) {

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        LATEST NEWS UPDATES | The youth unemployment bill -Manish Sabharwal    </title>
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-The Indian Express



Why the proposed national minimum wage is the wrong answer to questions of unemployment and poverty


The recent national labour conference - a trade union love fest with little real employer participation - demanded a national minimum wage. The..."/>
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Why the proposed national minimum wage is the wrong answer to questions of unemployment and poverty


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                            <div align="justify">-The Indian Express</div><p align="justify"><br /><em>Why the proposed national minimum wage is the wrong answer to questions of unemployment and poverty</em></p><p align="justify">The recent national labour conference - a trade union love fest with little real employer participation - demanded a national minimum wage. The trade union demand is a predictable positioning of narrow self-interest as national interest but the government's acceptance of their demand is unfair, delusional and economically stupid.</p><p align="justify">Unfair, because it pampers a small, organised and vocal minority by imposing costs on a silent unorganised majority and blunts the ability of chief ministers to forge their local labour market habitats. Delusional, because, currently, the Indian state does not have the capacity to enforce current labour laws for 90 per cent of workers and laws that are not enforced are corrosive. Economically stupid, because the cost of living varies greatly nationally and a single rate hurts young job seekers more than old ones. Legislating a national minimum wage is like trying to treat obesity by mandating small sizes; it doesn't work.</p><p align="justify">India's national floor level minimum wage of Rs 115 per day is currently non-binding on states. The new proposal will expand the power over minimum wages for the Central government from the current 45 industries to the 1,679 industries currently set by state governments. Monthly minimum wage rates vary from Rs 11,969 in Delhi for skilled to Rs 3,569 for unskilled in Sikkim. More importantly, state governments can - and do - exercise wide discretion, based on geography, skill levels, academic qualification, frequency of payments, and much else. If the current proposal is implemented, between 14 and 20 states will have to fall in line with the Central government diktat.</p><p align="justify">Legislating high minimum wages is popular with politicians all over the world because voters believe it is a &quot;free lunch&quot;, that is, it is an inexpensive alternative to higher taxes, has no real costs and helps the poor. But setting a national minimum wage for India has real costs. One, an academic review of more than 100 major academic studies on minimum wages says that 85 per cent of them find a negative effect on jobs for young and low-skilled workers. Two, 100 per cent of net job creation since 1991 has happened informally and artificially higher minimum wages will increase informal employment. Three, higher inflation, because most companies in India will pass on any &quot;above productivity&quot; wage increases to customers. Four, lower skill development, because we have not figured out how to fund skill development for informal employment. Five, a single national rate is more vulnerable to trade union capture. And six, reduced competition between states for jobs. The last point is critical because it is an unfortunate accident of history that labour is a concurrent legislative subject. It should be a state subject because policy must do all it can to foster competition between chief ministers. Taking away the minimum wage decision from state governments goes in the wrong direction.</p><p align="justify">The single national minimum wage rate demand must be rejected just like the demand for minimum wages in the MNREGS was. The MNREGS already distorts the labour market for unskilled work because its wage levels act like the LIBOR rate used to price loans - a benchmark for unskilled wages that employers are forced to price off. And just like the manipulation of LIBOR led to massive mispricing, the wholesale manipulations of wages in India by the MNREGS have greatly distorted the incentives, availability, and redeployment of labour. Not to mention that a 100-day job under the MNREGS violates more than 20 labour laws (PF, ESI, etc), does not create productive assets, and does not create skills.</p><p align="justify">Aruna Roy resigned from the NAC on the MNREGS minimum wage issue. I hope she understands that most employers agree that the objective of economic reforms is higher wages and not goofy rich people buying Gucci bags or Mercedes cars. However, higher wages don't create productivity but are a consequence of it. And economy-wide productivity will not rise till 15 per cent of our GDP comes from 55 per cent of the labour force deployed in agriculture. Some Chinese provinces have been able to raise minimum wages every quarter for the last three years because they have run out of farm labour to staff the workshop of the world. Foxconn - the maker of the iPhone - is setting up new factories thousands of kilometres inland from the coast, not for lower costs - they are going to pay the same wages deep inside the country that they pay their million employees on the coast - but because they can no longer get people to migrate from rural areas for jobs. China's exponential productivity increase (20 people now produce the same GDP that 100 people used to produce in 1990) has combined with a massive migration to non-farm employment (640 million since 1978) to produce the most effective minimum wage legislation the world has ever seen.</p><p align="justify">India cannot raise minimum wages without increasing manufacturing employment - stuck at 12 per cent of total employment since 1991. The limits of service sector growth are amply demonstrated by the kind of jobs taken by many of our 1.2 million engineers produced every year. Increasing manufacturing jobs needs many things - hard infrastructure, labour law reform, and a tighter coupling of education and employment - but minimum wage fudging is not going to help.</p><p align="justify">It is baffling that the rhetoric in the last election largely ignored unemployment and unemployability. The only explanation involves paraphrasing Stalin: a single unemployed person is a tragedy but millions of unemployed are just a statistic. 2014 is the first general election where first-time voters will have no memory of pre-reform India. The &quot;rights thought world&quot; of the last decade has not delivered and the proposed national minimum wage legislation has nothing do with poverty or unemployment. But there is a real danger for our youth that this minimum wage diktat will not lead to a higher wage but a wage that will be zero.</p><p align="justify"><em>The writer is chairman, Teamlease Services </em></p>                                                           
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    <br><a href="http://www.indianexpress.com/news/the-youth-unemployment-bill/1133750/0" class="re" target="_blank">The Indian Express, 26 June, 2013, http://www.indianexpress.com/news/the-youth-unemployment-bill/1133750/0</a><div class="clear"></div>
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Why the proposed national minimum wage is the wrong answer to questions of unemployment and poverty


The recent national labour conference - a trade union love fest with little real employer participation - demanded a national minimum wage. The..."/>
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    <h1 class="cat-box-title">The youth unemployment bill -Manish Sabharwal</h1>
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                            <div align="justify">-The Indian Express</div><p align="justify"><br /><em>Why the proposed national minimum wage is the wrong answer to questions of unemployment and poverty</em></p><p align="justify">The recent national labour conference - a trade union love fest with little real employer participation - demanded a national minimum wage. The trade union demand is a predictable positioning of narrow self-interest as national interest but the government's acceptance of their demand is unfair, delusional and economically stupid.</p><p align="justify">Unfair, because it pampers a small, organised and vocal minority by imposing costs on a silent unorganised majority and blunts the ability of chief ministers to forge their local labour market habitats. Delusional, because, currently, the Indian state does not have the capacity to enforce current labour laws for 90 per cent of workers and laws that are not enforced are corrosive. Economically stupid, because the cost of living varies greatly nationally and a single rate hurts young job seekers more than old ones. Legislating a national minimum wage is like trying to treat obesity by mandating small sizes; it doesn't work.</p><p align="justify">India's national floor level minimum wage of Rs 115 per day is currently non-binding on states. The new proposal will expand the power over minimum wages for the Central government from the current 45 industries to the 1,679 industries currently set by state governments. Monthly minimum wage rates vary from Rs 11,969 in Delhi for skilled to Rs 3,569 for unskilled in Sikkim. More importantly, state governments can - and do - exercise wide discretion, based on geography, skill levels, academic qualification, frequency of payments, and much else. If the current proposal is implemented, between 14 and 20 states will have to fall in line with the Central government diktat.</p><p align="justify">Legislating high minimum wages is popular with politicians all over the world because voters believe it is a &quot;free lunch&quot;, that is, it is an inexpensive alternative to higher taxes, has no real costs and helps the poor. But setting a national minimum wage for India has real costs. One, an academic review of more than 100 major academic studies on minimum wages says that 85 per cent of them find a negative effect on jobs for young and low-skilled workers. Two, 100 per cent of net job creation since 1991 has happened informally and artificially higher minimum wages will increase informal employment. Three, higher inflation, because most companies in India will pass on any &quot;above productivity&quot; wage increases to customers. Four, lower skill development, because we have not figured out how to fund skill development for informal employment. Five, a single national rate is more vulnerable to trade union capture. And six, reduced competition between states for jobs. The last point is critical because it is an unfortunate accident of history that labour is a concurrent legislative subject. It should be a state subject because policy must do all it can to foster competition between chief ministers. Taking away the minimum wage decision from state governments goes in the wrong direction.</p><p align="justify">The single national minimum wage rate demand must be rejected just like the demand for minimum wages in the MNREGS was. The MNREGS already distorts the labour market for unskilled work because its wage levels act like the LIBOR rate used to price loans - a benchmark for unskilled wages that employers are forced to price off. And just like the manipulation of LIBOR led to massive mispricing, the wholesale manipulations of wages in India by the MNREGS have greatly distorted the incentives, availability, and redeployment of labour. Not to mention that a 100-day job under the MNREGS violates more than 20 labour laws (PF, ESI, etc), does not create productive assets, and does not create skills.</p><p align="justify">Aruna Roy resigned from the NAC on the MNREGS minimum wage issue. I hope she understands that most employers agree that the objective of economic reforms is higher wages and not goofy rich people buying Gucci bags or Mercedes cars. However, higher wages don't create productivity but are a consequence of it. And economy-wide productivity will not rise till 15 per cent of our GDP comes from 55 per cent of the labour force deployed in agriculture. Some Chinese provinces have been able to raise minimum wages every quarter for the last three years because they have run out of farm labour to staff the workshop of the world. Foxconn - the maker of the iPhone - is setting up new factories thousands of kilometres inland from the coast, not for lower costs - they are going to pay the same wages deep inside the country that they pay their million employees on the coast - but because they can no longer get people to migrate from rural areas for jobs. China's exponential productivity increase (20 people now produce the same GDP that 100 people used to produce in 1990) has combined with a massive migration to non-farm employment (640 million since 1978) to produce the most effective minimum wage legislation the world has ever seen.</p><p align="justify">India cannot raise minimum wages without increasing manufacturing employment - stuck at 12 per cent of total employment since 1991. The limits of service sector growth are amply demonstrated by the kind of jobs taken by many of our 1.2 million engineers produced every year. Increasing manufacturing jobs needs many things - hard infrastructure, labour law reform, and a tighter coupling of education and employment - but minimum wage fudging is not going to help.</p><p align="justify">It is baffling that the rhetoric in the last election largely ignored unemployment and unemployability. The only explanation involves paraphrasing Stalin: a single unemployed person is a tragedy but millions of unemployed are just a statistic. 2014 is the first general election where first-time voters will have no memory of pre-reform India. The &quot;rights thought world&quot; of the last decade has not delivered and the proposed national minimum wage legislation has nothing do with poverty or unemployment. But there is a real danger for our youth that this minimum wage diktat will not lead to a higher wage but a wage that will be zero.</p><p align="justify"><em>The writer is chairman, Teamlease Services </em></p>                                                           
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    <br><a href="http://www.indianexpress.com/news/the-youth-unemployment-bill/1133750/0" class="re" target="_blank">The Indian Express, 26 June, 2013, http://www.indianexpress.com/news/the-youth-unemployment-bill/1133750/0</a><div class="clear"></div>
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    <h1 class="cat-box-title">The youth unemployment bill -Manish Sabharwal</h1>
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                            <div align="justify">-The Indian Express</div><p align="justify"><br /><em>Why the proposed national minimum wage is the wrong answer to questions of unemployment and poverty</em></p><p align="justify">The recent national labour conference - a trade union love fest with little real employer participation - demanded a national minimum wage. The trade union demand is a predictable positioning of narrow self-interest as national interest but the government's acceptance of their demand is unfair, delusional and economically stupid.</p><p align="justify">Unfair, because it pampers a small, organised and vocal minority by imposing costs on a silent unorganised majority and blunts the ability of chief ministers to forge their local labour market habitats. Delusional, because, currently, the Indian state does not have the capacity to enforce current labour laws for 90 per cent of workers and laws that are not enforced are corrosive. Economically stupid, because the cost of living varies greatly nationally and a single rate hurts young job seekers more than old ones. Legislating a national minimum wage is like trying to treat obesity by mandating small sizes; it doesn't work.</p><p align="justify">India's national floor level minimum wage of Rs 115 per day is currently non-binding on states. The new proposal will expand the power over minimum wages for the Central government from the current 45 industries to the 1,679 industries currently set by state governments. Monthly minimum wage rates vary from Rs 11,969 in Delhi for skilled to Rs 3,569 for unskilled in Sikkim. More importantly, state governments can - and do - exercise wide discretion, based on geography, skill levels, academic qualification, frequency of payments, and much else. If the current proposal is implemented, between 14 and 20 states will have to fall in line with the Central government diktat.</p><p align="justify">Legislating high minimum wages is popular with politicians all over the world because voters believe it is a &quot;free lunch&quot;, that is, it is an inexpensive alternative to higher taxes, has no real costs and helps the poor. But setting a national minimum wage for India has real costs. One, an academic review of more than 100 major academic studies on minimum wages says that 85 per cent of them find a negative effect on jobs for young and low-skilled workers. Two, 100 per cent of net job creation since 1991 has happened informally and artificially higher minimum wages will increase informal employment. Three, higher inflation, because most companies in India will pass on any &quot;above productivity&quot; wage increases to customers. Four, lower skill development, because we have not figured out how to fund skill development for informal employment. Five, a single national rate is more vulnerable to trade union capture. And six, reduced competition between states for jobs. The last point is critical because it is an unfortunate accident of history that labour is a concurrent legislative subject. It should be a state subject because policy must do all it can to foster competition between chief ministers. Taking away the minimum wage decision from state governments goes in the wrong direction.</p><p align="justify">The single national minimum wage rate demand must be rejected just like the demand for minimum wages in the MNREGS was. The MNREGS already distorts the labour market for unskilled work because its wage levels act like the LIBOR rate used to price loans - a benchmark for unskilled wages that employers are forced to price off. And just like the manipulation of LIBOR led to massive mispricing, the wholesale manipulations of wages in India by the MNREGS have greatly distorted the incentives, availability, and redeployment of labour. Not to mention that a 100-day job under the MNREGS violates more than 20 labour laws (PF, ESI, etc), does not create productive assets, and does not create skills.</p><p align="justify">Aruna Roy resigned from the NAC on the MNREGS minimum wage issue. I hope she understands that most employers agree that the objective of economic reforms is higher wages and not goofy rich people buying Gucci bags or Mercedes cars. However, higher wages don't create productivity but are a consequence of it. And economy-wide productivity will not rise till 15 per cent of our GDP comes from 55 per cent of the labour force deployed in agriculture. Some Chinese provinces have been able to raise minimum wages every quarter for the last three years because they have run out of farm labour to staff the workshop of the world. Foxconn - the maker of the iPhone - is setting up new factories thousands of kilometres inland from the coast, not for lower costs - they are going to pay the same wages deep inside the country that they pay their million employees on the coast - but because they can no longer get people to migrate from rural areas for jobs. China's exponential productivity increase (20 people now produce the same GDP that 100 people used to produce in 1990) has combined with a massive migration to non-farm employment (640 million since 1978) to produce the most effective minimum wage legislation the world has ever seen.</p><p align="justify">India cannot raise minimum wages without increasing manufacturing employment - stuck at 12 per cent of total employment since 1991. The limits of service sector growth are amply demonstrated by the kind of jobs taken by many of our 1.2 million engineers produced every year. Increasing manufacturing jobs needs many things - hard infrastructure, labour law reform, and a tighter coupling of education and employment - but minimum wage fudging is not going to help.</p><p align="justify">It is baffling that the rhetoric in the last election largely ignored unemployment and unemployability. The only explanation involves paraphrasing Stalin: a single unemployed person is a tragedy but millions of unemployed are just a statistic. 2014 is the first general election where first-time voters will have no memory of pre-reform India. The &quot;rights thought world&quot; of the last decade has not delivered and the proposed national minimum wage legislation has nothing do with poverty or unemployment. But there is a real danger for our youth that this minimum wage diktat will not lead to a higher wage but a wage that will be zero.</p><p align="justify"><em>The writer is chairman, Teamlease Services </em></p>                                                           
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    <br><a href="http://www.indianexpress.com/news/the-youth-unemployment-bill/1133750/0" class="re" target="_blank">The Indian Express, 26 June, 2013, http://www.indianexpress.com/news/the-youth-unemployment-bill/1133750/0</a><div class="clear"></div>
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Home हिन्दी

The youth unemployment bill -Manish Sabharwal

Published on Jun 26, 2013   Modified on Jun 26, 2013

-The Indian Express Why the proposed national minimum wage is the wrong answer to questions of unemployment and poverty The recent national labour conference - a trade union love fest with little real employer participation - demanded a national minimum wage. The trade union demand is a predictable positioning of narrow self-interest as national interest but the government's acceptance of their demand is unfair, delusional and economically stupid. Unfair, because it pampers a small, organised and vocal minority by imposing costs on a silent unorganised majority and blunts the ability of chief ministers to forge their local labour market habitats. Delusional, because, currently, the Indian state does not have the capacity to enforce current labour laws for 90 per cent of workers and laws that are not enforced are corrosive. Economically stupid, because the cost of living varies greatly nationally and a single rate hurts young job seekers more than old ones. Legislating a national minimum wage is like trying to treat obesity by mandating small sizes; it doesn't work. India's national floor level minimum wage of Rs 115 per day is currently non-binding on states. The new proposal will expand the power over minimum wages for the Central government from the current 45 industries to the 1,679 industries currently set by state governments. Monthly minimum wage rates vary from Rs 11,969 in Delhi for skilled to Rs 3,569 for unskilled in Sikkim. More importantly, state governments can - and do - exercise wide discretion, based on geography, skill levels, academic qualification, frequency of payments, and much else. If the current proposal is implemented, between 14 and 20 states will have to fall in line with the Central government diktat. Legislating high minimum wages is popular with politicians all over the world because voters believe it is a "free lunch", that is, it is an inexpensive alternative to higher taxes, has no real costs and helps the poor. But setting a national minimum wage for India has real costs. One, an academic review of more than 100 major academic studies on minimum wages says that 85 per cent of them find a negative effect on jobs for young and low-skilled workers. Two, 100 per cent of net job creation since 1991 has happened informally and artificially higher minimum wages will increase informal employment. Three, higher inflation, because most companies in India will pass on any "above productivity" wage increases to customers. Four, lower skill development, because we have not figured out how to fund skill development for informal employment. Five, a single national rate is more vulnerable to trade union capture. And six, reduced competition between states for jobs. The last point is critical because it is an unfortunate accident of history that labour is a concurrent legislative subject. It should be a state subject because policy must do all it can to foster competition between chief ministers. Taking away the minimum wage decision from state governments goes in the wrong direction. The single national minimum wage rate demand must be rejected just like the demand for minimum wages in the MNREGS was. The MNREGS already distorts the labour market for unskilled work because its wage levels act like the LIBOR rate used to price loans - a benchmark for unskilled wages that employers are forced to price off. And just like the manipulation of LIBOR led to massive mispricing, the wholesale manipulations of wages in India by the MNREGS have greatly distorted the incentives, availability, and redeployment of labour. Not to mention that a 100-day job under the MNREGS violates more than 20 labour laws (PF, ESI, etc), does not create productive assets, and does not create skills. Aruna Roy resigned from the NAC on the MNREGS minimum wage issue. I hope she understands that most employers agree that the objective of economic reforms is higher wages and not goofy rich people buying Gucci bags or Mercedes cars. However, higher wages don't create productivity but are a consequence of it. And economy-wide productivity will not rise till 15 per cent of our GDP comes from 55 per cent of the labour force deployed in agriculture. Some Chinese provinces have been able to raise minimum wages every quarter for the last three years because they have run out of farm labour to staff the workshop of the world. Foxconn - the maker of the iPhone - is setting up new factories thousands of kilometres inland from the coast, not for lower costs - they are going to pay the same wages deep inside the country that they pay their million employees on the coast - but because they can no longer get people to migrate from rural areas for jobs. China's exponential productivity increase (20 people now produce the same GDP that 100 people used to produce in 1990) has combined with a massive migration to non-farm employment (640 million since 1978) to produce the most effective minimum wage legislation the world has ever seen. India cannot raise minimum wages without increasing manufacturing employment - stuck at 12 per cent of total employment since 1991. The limits of service sector growth are amply demonstrated by the kind of jobs taken by many of our 1.2 million engineers produced every year. Increasing manufacturing jobs needs many things - hard infrastructure, labour law reform, and a tighter coupling of education and employment - but minimum wage fudging is not going to help. It is baffling that the rhetoric in the last election largely ignored unemployment and unemployability. The only explanation involves paraphrasing Stalin: a single unemployed person is a tragedy but millions of unemployed are just a statistic. 2014 is the first general election where first-time voters will have no memory of pre-reform India. The "rights thought world" of the last decade has not delivered and the proposed national minimum wage legislation has nothing do with poverty or unemployment. But there is a real danger for our youth that this minimum wage diktat will not lead to a higher wage but a wage that will be zero. The writer is chairman, Teamlease Services

The Indian Express, 26 June, 2013, http://www.indianexpress.com/news/the-youth-unemployment-bill/1133750/0

Tagged with: aruna roy minimum wages youth Unemployment Employment nac

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