Workers at rough end of lockdowns: Survey

According to the State of Working India Report, during the first wave, in 2020, more workers were forced to join the informal economy, mainly due to job losses (MIG photos/Varsha Singh)

A recent report by Stranded Workers Action Network (SWAN) says that the second wave has hit the country’s informal sector workers much harder than the last year, even though nationwide lockdown had not been imposed, unlike in 2020.

“Images of hungry and tired migrant workers making long journeys home were at the forefront of public discourse in 2020. This year, however, the impact of the crisis on the economically vulnerable and marginalised sections has received considerably less attention,” says the report, No Country for Workers’, one of the first nationwide surveys on the impact that the Covid-19 lockdowns and restrictions have had on the bottom of the pyramid or a vast majority of Indian population.

SWAN goes on to say that the second wave crippled the country’s health infrastructure and devastated entire families. It says that the localised restrictions combined with the lack of government response, have dealt a body blow to the majority of the country’s workforce, of which as much as 90 pc is in the informal sector, whose incomes have once again plummeted and whose livelihoods have come under increasing threat.

In this context, the Supreme Court order telling state and central governments to provide assistance to the needy people is crucial as most governments have pretended that the problem has been adequately addressed by them, says Gayatri Sahgal, member of SWAN, a volunteer-based group formed last year to study the impact of Covid-19 on migrant workers and to provide relief.

Regional lockdowns hurt as much as national

“The central government said it would not reimpose a nationwide lockdown and only local restrictions would be imposed by the states as per the need and hence the economy was not going to be impacted. So, they said, there was no need for Covid-specific economic relief measures for the people this year,” Sahgal tells Media India Group.

According to the State of Working India Report, published by the Azim Premji University, during the first wave, in 2020, more workers were forced to join the informal economy, mainly due to job losses. It also says that there was a severe decline in earnings for most workers and poverty amongst them rose by 15 pc in rural areas and as much as 20 pc in urban parts of the country.

This year, the situation is no better, as per a report by the Centre for Monitoring Indian Economy that says Labour Force Participation Rate (LFPR) or proportion of the employed or those seeking work dropped by another 40 pc, with a much more severe impact on informal sector workers.

The SWAN report says that without any work, wages or access to health facilities, the situation for millions of migrant and informal sector workers is particularly grim. Its helpline for migrants in distress received over 8000 calls, including 4,836 women and children. It says the key problems for practically for the callers were linked to the limited availability of food and rations, lack of access to basic healthcare, low levels of income and earnings, increasing levels of indebtedness, the struggles of surviving in the city, the additional set of concerns with returning to life in villages state and central government responses.

“We have been collecting data and there is also data from other organisations, so these lockdowns come on the back of a crisis that had already hurt incomes for a large section of the unorganised sector workers. This is a further blow to the already very weak economic standing of these workers and the impact this time was much more compounded,” says Sahgal.

To add to their misery, Sahgal says, the central government did not extend any monetary relief this year, only extending some food relief like last year.

A tepid response to monumental crisis

“So, in effect all this amounted to a very tepid response. And now reports say that the state government measures did not reach the migrant workers as even otherwise they are left out of most of these welfare schemes. We have seen this in Delhi and Maharashtra, for instance, where the government announced INR 5000 cash relief to each registered construction worker. However, in the registration process itself there were lots of loopholes due to which many workers were excluded. Story was no different in other parts of the country,” Sahgal says, adding, “So, we ended up in a situation where the migrant workers had much lesser to begin with and then the second wave hit the country, and it has been much more devastating than last year. Yet, there is hardly any relief measure for them.”

Thus, the Supreme Court order is definitely welcome and could not have come any sooner for millions of migrant workers. The data from various sources about the actual situation on the ground is chilling.

SWAN’s helpline for migrants in distress received over 8000 calls, including 4,836 women and children (MIG photos/Varsha Singh)

About 100 million people lost their livelihoods in April-May 2020 and of these 15 million remained outside the workforce even in October 2020. And the impact has been far more severe on women as even in October last year, less than one in five women remained employed and 47 pc of women permanently lost jobs, says research by Azim Premji University. It goes on to say that in barely 2 months, workers have suffered a wage loss of nearly INR 653.53 billion which is almost the annual budget for the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) for 2020-21.

SWAN says that due to woefully inadequate relief measures there was a sharp rise in hunger as nearly 48 pc of its 4,000 respondents reported that they went to bed at least once without a meal. The need to borrow money for food increased for 45 pc and nutritional quality became much worse for 40 pc of them. Prolonged closure of schools and anganwadis (day care centres for children) due to the lockdown meant that the already undernourished children faced more disastrous consequences, says SWAN.

Sahgal says that while the Supreme Court order is indeed timely and much needed, there are challenges in its implementation. “We hope that seeing the scope of the problem, the recent SC ruling telling governments to keep community kitchens going until end of the pandemic is very positive, but the basic issue is about the extent of the coverage. And the Centre needs to provide adequate rations to the states to help them feed the migrant workers,” she says.

Out of cash

One of the biggest concerns of several economists, including well-known developmental economist like Jean Dreze or Nobel laureates Amartya Sen or Abhijit Banerjee and Esther Duflo have been calling for the government to put significant amounts of cash in the hand of people, especially those in the low-income group. The main problem currently in the Indian economy is lack of demand and yet the government has only been addressing supply side of the economy, that too through half-hearted measures like credit guarantee schemes which have failed to make much difference on the ground.

Sahgal says cash is indeed in the king right now as the country’s vast majority of population has lived through an unprecedented drop in incomes over the past 18 months, and that too on the back of an economy that had been in decline for the past several years. Thus, the government’s reluctance to transfer cash to people remains surprising.

“Last year they gave INR 3000 for 6 months and the full package of measures amounted to INR 4.4 trillion in all. It may sound a big number, but it is not. Many organisations have already pointed out that the economic revival is not just an issue of supply, but more of demand. If we don’t put cash in people’s hands, it will not spur the economy. Even the recent measures announced by finance minister are limited to credit extension or credit guarantees. It is unclear why the government is going down this track because so many economists have said that these are not the best measures in face of this kind of crisis,” she warns.

The lack of an adequate response is likely to end up pushing inequality in India even higher from its already high levels. Surveys show that between March and August, 2020, the average Indian household’s total income decreased by 17 pc compared to the same period in the previous years and even as the country was going through its most harrowing crisis since independence, the proportion of income of the top 25 pc of the population rose from 64 pc to 80 pc.