How much does a factory worker earn in India?

MAnufacturing workers aren’t simply poorly paid, they ar also sir thomas more potential to act without basic rightsThe paycheck is the most important part of a salaried job, but it is not the only one. Job quality also depends on whether workers have written contracts, paid leave, or social security contributions. PLFS data shows that manufacturing workers lag even on these counts. Only 16.5% of manufacturing workers had a written contract, and only about one in five had some form of social security benefits and paid leave. Manufacturing performs poorly compared to all non-agriculture, non-construction sectors, except the broad trade and restaurants category. To be sure, social security, contracts, or paid leave are irrelevant for 44% of manufacturing workers because they are self-employed. However, this does not mean that self-employed manufacturing workers are better off, because manufacturing workers who are self-employed earn less than both the average self-employed person in India and the salaried manufacturing worker. (See Chart 2)Manufacturing becomes less and less rewarding as workers ageThis is among the most damning statistics for a worker who wants to make a long-term career in manufacturing. Average wages for salaried manufacturing workers are higher than the economy-wide average for the 15–18-year cohort of workers. However, this advantage reverses and continues to reverse as one moves toward older cohorts of workers. For workers above 40 years of age, average wages in manufacturing are almost 20% less than what the average salaried person in that age bracket earns. (See Chart 3)A rapid proliferation of contract work has only made things worse for the average manufacturing workerThe Annual Survey of Industries (ASI), which covers the registered manufacturing sector, defines a contract worker as someone employed through a contractor (not necessarily through a written contract). One can assume that such workers are paid less than those employed directly by a factory and have no benefits. ASI data shows that the share of such contract workers has more than doubled in India’s factories since the turn of the century: from 20% in 2000-01 to 42% in 2023-24. (See Chart 4)To be sure, none of these conditions might have triggered the current protests. What might have played a role is the spark provided by the recent inflationary shock for things such as cooking gas, combined with the pent-up anger from working under immense material strain even earlier.