Think Out of the Box
If someone still denies that there is a slowdown in business, no job losses, or that consumer buying sentiment is not depressed, it would be like daydreaming. It is very much here, and there is no other option but to accept, face, and put remedial measures in action fast. There have been a number of media and other reports about this problem that is going to leave a cascading effect. The slowdown is not restricted to the auto sector only. It has reached the textile, real estate, electronics, and retail sectors even. The job outlook is negative in these sectors.
The reasons for this slowdown could be many, and it is for experts to discuss, evaluate, and draw a roadmap. However, our concern is the ripple effect of this slowdown on human resources. It is reported that lakhs of jobs in the auto sector and other industries have been lost, mostly affecting contractual laborers meeting their ends on minimum wages. It is also possible that many small employers might have lost their businesses. Hiring is not optimistic except in the e-commerce industry, and that too only temporarily due to the coming festive season.
The Bigger Question
The bigger question we would like to raise is why, in good times, we call our people an asset and sing songs with rhetoric about people development, and in bad times, they are the first to be axed. Why can't job losses be the last resort for any business in bad times? Is it because of mindset, a soft target, the visibility of people, or something else? When the employee wages component in business is about 3-5% of sales, is it really going to make any meaningful impact on cost reduction exercises? Have we ever thought that job losses are not just reducing a number or saving a meager amount but throwing a family of that person into a dark tunnel? Should we not think of other meaningful alternatives and create a buffer zone for such bottom-line employees? A paradigm shift in thought process is surely required when it comes to taking away jobs.
Narrative on Labour Laws
There has been a narrative being built for a long time that archaic labor laws are speed breakers in generating employment opportunities. Unless reforms (hire and fire powers to employers) are done, there would be no employment growth. There is no empirical data or any research or study available confirming the above narrative. Labor reforms have nothing to do with creating more employment opportunities. In 2014, many states diluted the retrenchment, closure, and layoff provisions. There is no evidence that such reforms have helped increase employment. Recently, employer contributions to ESI have been reduced. No data is available that reflects employment growth because of this reform. If that had been so, why have labor reforms done in the past not helped in the slowdown and insulating job losses? Should we not assess the genuineness of the narrative?
The October 2019 edition cover story is all about these issues, where experts and industry practitioners have unfolded the possible reasons for the slowdown, provided tips on how to handle people issues in bad times, and discussed the effect of labor reforms. If you like it, let us know. If not, well, let us know that too.
From India, Delhi
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181If someone still denies that there is a slowdown in business, no job losses, or that consumer buying sentiment is not depressed, it would be like daydreaming. It is very much here, and there is no other option but to accept, face, and put remedial measures in action fast. There have been a number of media and other reports about this problem that is going to leave a cascading effect. The slowdown is not restricted to the auto sector only. It has reached the textile, real estate, electronics, and retail sectors even. The job outlook is negative in these sectors.
The reasons for this slowdown could be many, and it is for experts to discuss, evaluate, and draw a roadmap. However, our concern is the ripple effect of this slowdown on human resources. It is reported that lakhs of jobs in the auto sector and other industries have been lost, mostly affecting contractual laborers meeting their ends on minimum wages. It is also possible that many small employers might have lost their businesses. Hiring is not optimistic except in the e-commerce industry, and that too only temporarily due to the coming festive season.
The Bigger Question
The bigger question we would like to raise is why, in good times, we call our people an asset and sing songs with rhetoric about people development, and in bad times, they are the first to be axed. Why can't job losses be the last resort for any business in bad times? Is it because of mindset, a soft target, the visibility of people, or something else? When the employee wages component in business is about 3-5% of sales, is it really going to make any meaningful impact on cost reduction exercises? Have we ever thought that job losses are not just reducing a number or saving a meager amount but throwing a family of that person into a dark tunnel? Should we not think of other meaningful alternatives and create a buffer zone for such bottom-line employees? A paradigm shift in thought process is surely required when it comes to taking away jobs.
Narrative on Labour Laws
There has been a narrative being built for a long time that archaic labor laws are speed breakers in generating employment opportunities. Unless reforms (hire and fire powers to employers) are done, there would be no employment growth. There is no empirical data or any research or study available confirming the above narrative. Labor reforms have nothing to do with creating more employment opportunities. In 2014, many states diluted the retrenchment, closure, and layoff provisions. There is no evidence that such reforms have helped increase employment. Recently, employer contributions to ESI have been reduced. No data is available that reflects employment growth because of this reform. If that had been so, why have labor reforms done in the past not helped in the slowdown and insulating job losses? Should we not assess the genuineness of the narrative?
The October 2019 edition cover story is all about these issues, where experts and industry practitioners have unfolded the possible reasons for the slowdown, provided tips on how to handle people issues in bad times, and discussed the effect of labor reforms. If you like it, let us know. If not, well, let us know that too.
From India, Delhi
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In times of economic slowdown and job losses, it is crucial for businesses to rethink their approach towards human resources. Instead of viewing employees as expendable assets, companies should consider alternative strategies to mitigate job losses. Implementing measures to safeguard employees during tough times can not only benefit the workforce but also contribute to long-term organizational stability. It is essential to reevaluate the impact of labor reforms and focus on creating a supportive environment for employees facing uncertainties. By prioritizing the well-being of employees and exploring innovative solutions, businesses can navigate through challenging times while maintaining a positive work culture.
From India, Gurugram
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From India, Gurugram
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Panel to rework Factories Act in a step towards labour reforms.pdf
Labour Law Reforms.doc