Forget ‘Smart Cities’, India First Needs to Build a ‘Smart Labour Force’


The lane outside my house has been dug up for over a month and a half now. The process of laying down new sewer lines is painfully slow and the toxic cocktail of dust, debris and Delhi’s omnipresent pollution is becoming a health hazard for the residents.

In the middle of this urban repair, PM Modi launched three flagship schemes for urban transformation- the Smart Cities Mission, the Pradhan Mantri Awas Yojana or ‘Housing for all’ Scheme and, the Atal Mission for Rejuvenation and Urban Transformation or AMRUT. The aim- to make our existing cities smart and create Greenfield tech- savvy metropolises, provide a home to every Indian including the slum dweller population, and to make our degenerating urban infrastructure robust and sustainable.

Enough has been written and read about their achievability and challenges. The expertise and experience is pouring in from all directions of the globe, and so is money. The opportunity is as big for India as for the developed nations who are looking at our country as a new investment avenue. We all know that land is going to be a major bottleneck in the way of realising these missions. But there is another issue which is equally if not more important than land, and, has escaped everyone’s attention- the labour force.

The sight of emaciated labourers laying down sewers and casing it at the rate of a brick/day outside my house compels me to delve deep into the chronic problem of labour force in our country.

The construction sector often cites the issue of labour shortage while real estate developers blame project delays on severe labour crisis. This makes me wonder, with the size of our population where people are spilling out of buses, metros, trains and every possible mode of transport, we can have anything but labour shortage.

The builder body, CREDAI, pegs the overall labour shortage figure at about 40% of the current requirement, leading to project cost overruns. The situation is only going to get worse as the building, infrastructure and real estate sector will require an estimated 76.5 million trained and skilled workers by 2022. Most of this demand would be in affordable housing segment which would need 38 million qualified workers by 2030.

According to KPMG, 11 crore houses will likely be required by 2022 at a rate of about 35,000 homes every day. This is a huge figure by any standard and especially when developers in our country claim that they function at just 55% of their efficiency levels because of the unreliable supply of labour and contractors.

Not just quantity, quality of workforce is an equally grave issue. Sample this, in India’s housing sector, which is the second largest employer in the country and has 4.3 crore workers, only 8 per cent are skilled.

Studies suggest that Indian construction workers are also less productive than their counterparts in other parts of the world- for instance- in Germany, 1 million sq. ft of building can be constructed using just 100 workers, but in India it takes 1,000 workers to build a similar building in the same period.

Contractors blame the problem of labour shortage on the ongoing process of economic reforms in poor and underdeveloped states. This coupled with 100 days of guaranteed MNREGA jobs dissuade the labour force to step out of their villages to look for work at tough and sweltering construction sites.

The deplorable living conditions at construction sites is an ugly truth of our modern day development business where providing very basic facilities like makeshift homes, a crèche for children and availability of doctor once a week is considered a CSR activity. No, I am not painting the entire industry with the same brush but no one can dispute the presence of this larger trend.

The real problem lies in the temporary nature of this business- the developer offloads the construction to a contractor who then sublets it to various sub-contractors. They again have ‘sub- sub’ contractors who source cheap labourers and masons from our indigent villages. The structure of this industry is such that the worker neither gets rewarded for his productivity nor has a career map charted where he could see himself progressing from a labourer to a sub-contractor someday. Result- low productivity, insufficient efficiency and quick migration from one construction site to another in lieu of a few extra rupees.

There is also a complete lack of pull factor for the potential workforce entrant to acquire professional certifications. While global standards demand certified labour force on construction sites, the scene in India is quite grim. Barring a few industry giants likes L&T, Shapoorji Pallonji, etc, majority of contractors and developers in our country don’t bother about certifications, saving themselves a few extra bucks.

There have been both private and public initiatives imparting skill-based training, both on and off construction sites. But the number of people acquiring certifications is nothing but a drop in the ocean.

We, probably, need a hammer and sickle to undo and redo the very structure of how this industry functions. This would need a complete overhaul in our labour laws and skill development policy.

The government is trying to solve one end of this spectrum with the Union Cabinet recently giving its approval to the ‘National Skill Development Mission’. The current policy, replacing the older one implemented in 2009, aims to provide a strong institutional framework at the Centre and States for implementation of skilling activities in the country.

Based on data from the 68th Round of NSSO, it is estimated that only 4.69 percent of India’s total workforce has undergone formal skill training, compared with a staggering 52 % in the USA, 68 % in the UK, 75 % in Germany, 80 % in Japan and an astounding 96 % in South Korea. Saying that we have a long way to go will be an understatement, the journey would be longer than we can imagine.

The task is of monumental proportion but all it requires is genuine and quick ‘will’ and ‘emotions’ to put things in ‘motion’.

Neetika Bajaj, Sub Editor- TV & Web, Real Estate

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