Strengthening Wage Policies to Protect Incomes of the Informal and Migrant Workers in India

Labour and Development, V. V. Giri National Labour Institute 2021

29 Pages Posted: 12 Feb 2021

See all articles by Anoop Satpathy

Anoop Satpathy

V. V. Giri National Labour Institute

Xavier Estupinan

International Labour Organization (ILO)

Bikash K. Malick

Government of India - Indian Economic Service

Date Written: February 11, 2021

Abstract

The Government of India is leveraging wage policy as a part of overall fiscal policy actions to protect the income of the informal and migrant workers affected by the COVID-19 pandemic and resultant lockdown measures. The statutory minimum wages through its redistributive mechanism and MGNREGS wages as an effective fiscal stimulus, could help alleviate the hardship faced by the informal workers and returnee migrants. However, for wage policies to act as an effective antidote, wage levels and their adequacy along with full implementation are of paramount importance. In this context, the paper argues that the level of both statutory minimum wages and MGNREGS wages are very low in India, and several implementation bottlenecks inhibit them from delivering results. It limits the very effectiveness of wage policies, unless prompt actions are taken to strengthen and revamp these policy tools. Under this backdrop, this paper provides an alternative framework for setting and revising minimum wages and MGNREGS wages at an adequate level. This is expected to significantly strengthen the current wage policies in addressing their stated objectives of reducing poverty and inequality while supporting a human-centred economic recovery process.

Keywords: India, COVID-19, wage policy, minimum wage, floor wage, MGNREGS wage, poverty, inequality, informal worker, migrant worker

JEL Classification: J3, J31, J38, J46, J48, J65, J83

Suggested Citation

Satpathy, Anoop and Estupinan, Xavier and Malick, Bikash K., Strengthening Wage Policies to Protect Incomes of the Informal and Migrant Workers in India (February 11, 2021). Labour and Development, V. V. Giri National Labour Institute 2021, Available at SSRN: https://ssrn.com/abstract=3784102 or http://dx.doi.org/10.2139/ssrn.3784102

Anoop Satpathy (Contact Author)

V. V. Giri National Labour Institute ( email )

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India
09910048831 (Phone)
201301 (Fax)

HOME PAGE: http://https://vvgnli.gov.in

Xavier Estupinan

International Labour Organization (ILO) ( email )

Route des Morillons 4
Geneva, 1211
Switzerland

Bikash K. Malick

Government of India - Indian Economic Service ( email )

Room No. 59, DEA, North Block, New Delhi
Delhi, Delhi 110092
India

HOME PAGE: http://www.ies.gov.in

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