Employers and employer organizations need to influence the IR system with the changing industrial landscape in the context of competitiveness
I'm quite excited about the Make In India campaign and I think the timing is perfect. The campaign, which is aimed at making India a global manufacturing hub, will help the sector to grow, contribute at least 25 per cent to the GDP and be at par with other advanced Asian countries. It currently contributes just over 15 per cent. This will also help in creating a bridge that will connect village clusters to global markets to promote export.
Manufacturing is a labour intensive industry. Countries like Japan, South Korea and China got richer by redeploying unskilled farmers in factories. However, today these countries are plagued by rising labour costs (China) and military tensions (Japanese firms are shifting production from China). India has help from its currency as well—the rupee has fallen making Indian workers more competitive. That directs a future of rising demand for labour in India. However, our industry relies heavily on high-tech manufacturing and employs only a few million people in the organized industry.
So, although we ought to keep our ears on the ground and need to plan ahead, we are not headed for a labour shortage and we believe that the Make in India campaign will not only accelerate the national growth index, it will surely fuel our engines too. There is a need to make critical amendments to labour laws to facilitate this growth. The “content” of the changes is very important, while the amendments on procedural aspects like “simplified return” etc. have begun. I think there also needs to be increased emphasis on policy transparency, infrastructure and skill development.
Today, India has more than 50 per cent of its population below the age of 25 and more than 65 per cent below the age of 35. It is expected that in 2020 the average age of an Indian will be 29 years. We have high unemployment/ disguised employment and ‘Make in India’ is the right move for Employment Index growth. With at least 33 per cent of the population below poverty line, Make In India is the right pitch rather than Made In India.
Changing IR landscape
With changing industrial landscape, employers and employer organizations need to influence the industrial relations system (including the labour law) in the context of competitiveness. It is also a fact that not all employer organizations in India are adequately equipped to do so; they need to acquire the requisite knowledge base needed to influence the policy environment.
This also implies that employers’ organizations will have to develop a strategic perspective of IR in the same way that employers are seeking to develop HRM policies and practices, which foster competitiveness. I think the HR fraternity as such needs to have deeper IR experience and to that extent it has been the realization of senior HR fraternity to build this capability among the young HR professional. The organizations like EFI and NHRD have been working extensively in this direction through different models.
At Lupin, every manufacturing location is headed by the HR professional who is fully competent and mature in IR. Apart from this, the factory/ site heads are also fully trained and seasoned professionals in ER. There are skip level meetings, Town Halls, Open Houses etc. creating different touch points to anticipate, understand and address IR issues. They also bring about “Inclusive Work Practices” to decimate any divide between management and workers. Several structured and focused training programs are also conducted to keep the key stakeholders abreast of the changing laws and industrial environment.