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Tuesday, 30 August 2016 07:26

RISING PRICES – FROZEN WAGES

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One of the key demands being raised by workers across the country and for which they are going on strike on 2 September 2016 is price rise. Like a slow burning fire, prices of all essential commodities have been steadily increasing over the past years. But food items, especially such essentials like pulses, milk and vegetables have risen steeply destroying family budgets of all except the rich. The Modi government has been claiming that prices are not rising by pointing at wholesale prices. But the common workers don’t go and buy dal and vegetables from wholesalers in mandis. They buy it from their local stores. These prices are somewhat more accurately reflected in the consumer or retail prices that are also available with the government but it refuses to look at them. This is another example of how the government is simply trying to fool the people rather than seriously tackle price rise.
There is another side to the story of sky-rocketing price-rise. This is to do with earnings of working people. The reason why price-rise hurts so much is that earnings never rise as much as prices of items that you buy. That is why price-rise is actually a hidden way of robbing the working people. Even if some increase in wages or salaries takes place, prices of essential commodities rise more than that and the working person’s family end up losing more than they gain.
Let us take a look at two examples. In rural areas, between March 2014 and March 2016, prices increased by 11% according to the government’s Consumer Price Index for Agricultural Labourers. This is, of course, an underestimate, but still it gives us an idea of how prices are increasing. Now have a look at the increase in wages for different kinds of work in rural areas, both agricultural and non-agricultural.

Prices vs Wages (March 2014 to March 2016)

In rural areas

For industrial workers

Price Increase

11%

 

Price increase

8%

 

Wage Increase (%)

Wage increase (%)

 

Non-Agri Labour

9

 

Textile workers

7%

 

Construction

11

       

Ploughing

11

       

Harvest

13

       

Animal husbandry

13

       

Agri Labour

13

       

Sowing

15

       

Source: Labour Bureau

 

For non-agricultural work, wages increased by just 9% in two years while for general agricultural labour wage rates increased by 13%. Compare this to the price rise: it was 11% in these two years. So wage increases are barely compensating for price rise. For construction and ploughing operations the wage increase is the same as price increase. In some other kinds of work wage increase is just a couple of percentage points above the price increase rate.
Here it needs to be kept in mind that wages are shockingly low, just allowing the family to survive. For example, in the data given above, all wages are roughly in the range of Rs 6000 to Rs 7000 per month, but not for the whole year. Most agricultural work is seasonal and even if there are two crops being grown, that may mean 6-8 months of work for a laborer’s family. If one adjusts for this seasonality of work, the monthly wage will drop to just Rs.4000 to Rs.5000.
Govt. data on industrial wages is scant and much delayed. The only kind of data available regularly is for textile industry. But it can be taken to represent general industry trends. Analysis shows an equally dismal situation. Prices have increased by about 8% over two years according to the Consumer Price Index for Industrial Workers but monthly wages have increased by just 7% in this period. So, industrial workers are actually losing out because of relentless inflation. Industrial workers get about Rs.8000 per month but this is for regular employees. Contract and casual workers may get as little as two-thirds of this amount according to trade union activists, with none of the other benefits given to regular workers.
This is the experience across the country from workers in big industries to small units, from agricultural labourers to cultivators. Where there are unions, or where the govt. feels it needs to prevent unrest (as in govt. employees) wage increases are linked to price rise. But for most of India’s 50 crore working people price rise continues to be a weapon of robbery.
It is for this reason that the workers are demanding that at least Rs 18,000 minimum wage be fixed for workers and that there should be linkage with price rise so that this robbery ends.

 

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