Most workers in India are dependent on semi-skilled and unskilled manual work for their livelihoods. According to the latest Rural Labour Enquiry Report, about 40 per cent of rural households derived their income from manual work. Data from the Census of India 2011 indicate that over 300 million workers belong to manual worker households in the countryside. Income poverty among manual worker households depends on the availability of employment and the level of wages. The rural wage rate is thus a critical indicator of the well-being of workers and their families.

In a recent research article, Professor Yoshifumi Usami and I have examined trends in rural wage rates over the last 18 years (Das and Usami, 2017). This analysis is based on data from Wage Rates in Rural India for men and women, for agricultural and non-agricultural operations. Nominal wages were deflated by the Consumer Price Index for Agricultural/Rural Labour (CPI-AL/RL) at 2010 prices. The striking finding of our analysis is that after a period of stagnation from the late 1990s to the mid-2000s, rural wage rates for men and women and across occupations grew at a significant rate from 2006-7 up to 2014-15. The last two years have again been a period of stagnation.

In the first period, from 1998–99 and 2006–7, wage rates for major agricultural and rural occupations remained stagnant or declined at the all-India level. There was negative growth in agricultural wage rates in Madhya Pradesh and Rajasthan. Six eastern and north-eastern States, namely, Bihar, Manipur, Meghalaya, Odisha, Tripura, and West Bengal, as well as Himachal Pradesh, witnessed a stable rising trend of agricultural wage rates from 1998-99 to 2006-07. Wage rates for agricultural and rural labour in Uttar Pradesh were stagnant. Gujarat presented a mixed picture: while wage rates for ploughing grew, wage rates for the remaining occupations, in particular non-agricultural tasks, declined. Non-agricultural wage rates in Punjab, for skilled and unskilled labour, showed negative growth in this sub-period. Wage rates of non-agricultural occupations recorded positive growth in Kerala and Tamil Nadu.

In the second period (2006-07 to 2014-15), the growth rate for wage rates of all major occupations increased by more than 6 per cent per annum at the all-India level. This growth took place in most large States, and across all occupations, agricultural and non-agricultural, and for males and females. Bihar and Tamil Nadu recorded the fastest growth of both agricultural and non-agricultural wage rates.

The steady growth of agricultural and rural labour wage rates ended in 2014-15, with a mere one to two per cent increase at the national level between 2014-15 and 2015-16. There was a mixed picture across States. In 2015–16, real wage rates for major agricultural operations declined in Tamil Nadu, Rajasthan, and Maharashtra. Real wage rates for agricultural occupations rose in Meghalaya, Andhra Pradesh, Assam, Bihar, Karnataka, and Odisha. Non-agricultural occupations also registered a similar trend. There was a marginal rise in 2016–17. For example, the real wage rate for ploughing rose from Rs 176 in 2015–16 to Rs 180 in 2016–17. Wage rates for females in harvesting, threshing and winnowing rose from Rs 130 to Rs 132.

There is urgent need to monitor and study the recent stagnation in rural wage rates as it affects the lives of millions of rural workers.

Reference

Das, Arindam and Usami, Yoshifumi (2017),“Wage Rates in Rural India, 1998–99 to 2016–17” Review of Agrarian Studies, 7, 2, available at http://www.ras.org.in/wage_rates_in_rural_india_1998