Co-Written by Amit Kumar & Puja Pal
The outbreak of COVID-19 and the measures taken to deal with pandemic have an unprecedented impact on informal sector workers. ILO predicted that coronavirus could cause loss of 25 million jobs across the world. Global unemployment which already stood at 190 million before the spread of coronavirus, can further rise drastically. The pandemic crisis will severely affect the world of work.
On the last day of the lockdown 1.0, PM Modi addressed the nation again and announced the Lockdown 2.0 in which he further extended the lockdown to another 19 days. However, he announced that the economy may gradually open in the second phase of lockdown which will end on 3rd May. Now, before entering into the second phase of lockdown, it is pertinent to access the impact of lockdown 1.0 on the worst-hit informal sector of India. India has a large informal sector where some 93 percent of the workforce are employed without any form of social security net (Economic Survey, 2018-19). Within the informal workers, home-based workers are the most vulnerable and invisible workers. The essay tries to assess the impact of lockdown on the economic condition of Home-Based Workers in India. This is based on the telephonic interview of 10 HBW employed in the apparel sector in Delhi.
Home-based workers are the ones who work from their homes. There are two categories of home-based workers. One, the own account workers who source the raw material by themselves and take their product to the market. Two, homeworkers or outworkers, they receive work from the contractor/sub-contractors and are paid on a piece-rate basis.
According to the Periodic Labour Force Survey 2017-18, there are 30 million home-based workers in India. However, as per various organization working for home-based workers, this is a serious underestimation of HBW in India. Around 50 percent of them are employed in manufacturing. Within manufacturing, it is the apparel & textile industry which employs more than 52 percent (7.8 million) of the workers, another 20 percent are employed in the tobacco industry. The median monthly earning of the women home-based workers are Rs 2500 (PLFS, 2017-18). So, even after working for long hours (8-12), these workers struggle to earn for their survival, forget about the minimum wages stipulated by the state. More than 67 percent of all the home-based workers are earning below the minimum wages determined by the expert committee set up by the government. Due to the lack of any direct relationship between employer and employee, they are mostly out of any form of social security net. Many of these workers reside in the slums in the urban areas in pathetic living conditions. Being their home as a workplace, they are exposed to various occupational hazards. Within the informal worker’s category, HBW is least visible workforce and rarely feature in any government programmes or policies.
The workers reported that they have not received any new work orders and have no access to raw material since the announcement of lockdown by the government. The situation of some workers is even more chronic in North-East Delhi, as they have not received work for a long time. First, due to the communal riots in these areas and now due to the lockdown. This has resulted in acute loss of their source of income and they are worried about the situation getting further worse.
Four of the workers have not even received their previous payment from the contractors due to the lockdown. Due to this, they were not able to even stock ration for the lockdown period. Most of the migrant HBW have gone back to their native place and those who couldn’t go back are finding difficult to pay rent of even one month. As most of the HBW are illiterate they are finding difficult to access reliable information on coronavirus. Government’s emphasis on ‘social distancing’ as the most effective preventive measure but it is practically impossible in over-crowded urban slums where most of these HBW resides. HBW and their families have very limited access to the clean water and soaps to wash their hands. A sense of isolation and helplessness has been felt by the HBW.
Even though the government has announced economic package including cash transfer but the home-based workers does not figure in any of these announcements. The supply of rations through PDS has been announced but many of the HBW are migrants and they do not have ration cards here. Also, those having ration cards have to stand in a long queue which makes them more contagious to the virus. Many of them are not receiving the free extra ration announced by the government.
Some Short and Long-Term Intervention Needed
Given the dismal economic condition of HBW due to the pandemic crisis, the government should introduce some short-term immediate relief package. Income support packages including cash transfer to these workers equal to the minimum wages for at least 2 to 3 months. Direct cash transfer can be made to those having a bank account and for the others government can take the help of the membership-based organization (SEWA, WEIGO) and unions working for the home-based workers in order to identify the workers. Reliable information must be provided through various means (Newspaper, Announcement). Essential goods should be supplied to these workers at their doorstep. As a preventive measure, the government should install the mobile washbasins with soaps in slum areas. So, that chances of spreading the diseases in these areas can be minimized.
The home-based workers are unregistered, unrecognized and unfortunately unregulated. The voices of these workers are raised by some collectives and NGOs including SEWA (Self-Employed Women’s Association). However, due to lockdown, they are not able to mobilize the workers. Although some of the workers reported that they have received one-time ration from the SEWA (10kg of rice, 5kg wheat, 2-3 kg pulses and oil). However, without adequate support, they will run out of any ration which they have. So, if there is no concrete action taken by the government, then these workers will die due to hunger before coronavirus reaches to them.
In long-run, sustained interventions are needed like recognition of these invisible categories of workers through policies and laws. So, that they can be protected in adverse situations like COVID-19 pandemic. Ensure that firms recognize these HBW as part of their supply chain and provide them with minimum wages and some sort of social security protection. State government should set up the Recovery Fund for the informal workers including home-based workers. Strengthen the NGO’s efforts and initiative to organize these workers. Improving the access to basic services, housing, childcare and public health facilities for HBWs.
Former governor of RBI, Raghuram Rajan, says that ‘India reforms only in crisis’. Thus, the pandemic crisis has given the opportunity to reflect on the where India’s labour market policies went wrong that it triggered looming economic crisis. This shows how little or less our economic policies protect the large workforce employed in the informal sector. Without any adequate backing of social security nets, access to income, and feasible financial support, these vulnerable workers are at highest risk of slipping into the vicious circle of poverty.
Amit Kumar is a research scholar at the Centre for Economic Studies and Planning (CESP), JNU, New Delhi.
Puja Pal is a research scholar at the Centre for Economic Studies and Planning (CESP), JNU, New Delhi.