UPSC PRELIMS 2020 : States Reserving Jobs for Locals

States Reserving Jobs for Locals

Topic : States Reserving Jobs for Locals

Topic in Syllabus: Indian Governance

 

Context:

States Reserving Jobs for Locals

  • Many states in India are bringing in laws similar to the Andhra Pradesh Employment of Local Candidates in the Industries/Factories Act 2019.
  • This signals a threat of parochialism (narrow outlook), affecting the larger economic interests of the country.

 

Background:

  • India’s Constitution too guarantees labour mobility under Article 19 which says that every individual could freely move in and around the country and work anywhere s/he wishes to.
  • In all, the free movement of labour and capital must move hand in hand for the evolution of capitalism under a democratic framework.

 

Why is diversity in recruitment essential?

  • If the workforce from a particular region is identified with a particular set of skills, it is because of social, economic and geographical factors specific to that region.
  • Labour contractors in infrastructure projects are aware of these aspects as they seek to maximise efficiency and quality.
  • Organisations that pursue social diversity as a matter of policy (‘equal opportunity’ employers) too have experienced commercial success.This is because they are able to be responsive to the needs of an equally diverse marketplace.
  • This is particularly true for sectors with a direct customer interface (such as Fast-Moving Consumer Goods, aviation and media).Nevertheless, it extends to other areas as well.

 

Threats in local employment?

  • For the Indian economy, its diverse labour pool is a key strength.
  • Given this, a few states seeking to disregard this advantage is an unhealthy sign.
  • The states are likely to lose their productive edge in the process.

 

Disadvantages:

  • increase the risks of labour shortages
  • trigger a rise in unemployment
  • aggravate wage inflation
  • render labour markets rigid and incompetent
  • exacerbate regional inequalities

It is also odd that States should erect labour market barriers at a time when the country is moving the other way.

India is increasingly removing barriers to inter-State trade and to the movement of capital across entities, by implementing the bankruptcy law.

 

Way forward:

  • Cosmopolitanism has been one of the driving forces in India’s early industrial success.
  • Be it Mumbai, Kolkata, Ahmedabad or other industrial townships created in the hinterland, the above has been true.
  • When ‘outstation’ workers merge into the host populations, they initiate a social process that make societies more egalitarian, secular and tolerant.

 

Sample Question:

Which has become the first Indian state to announce a 75% job reservation for local youth?

(A) Kerala
(B) Karnataka
(C) Andhra Pradesh
(D) Punjab

 

Solution: (C)

Andhra Pradesh has become the country’s first state to reserve jobs for local youths. The state government has passed the Industries/Factories Act, 2019 which reserves 75% jobs in all the industries and factories running in the state.