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Entry-level jobs could soon pay Rs. 18000 all across India and that could be a problem

 

While lay-offs have become the norm especially in futuristic sectors like IT, the Union cabinet has cleared the labor code on minimum wages, creating a minimum wage barrier of Rs. 18,000/-

With the implementation of this bill, any state is bound by law to not pay a lesser amount. This translates to that the minimum wage for someone working in a metro city will be the same as that of a person in a small town. Likewise a B.com graduate and a 10 th pass delivery boy of an e-commerce company will get the same minimum wage at the entry level.

The economics of wages is largely dependent on demand and supply of talent and the cost of living. It is unfair to apply a universal minimum wage across different states with varying demographics.

The bill if passed in the parliament, will place considerable burden on the employers as they will not be able to pass on this sudden rise in cost to customers. This entry barrier will mean that both the businesses will not be able to mushroom or be competitive and it will be highly likely that these entry level jobs will move back to the informal sector.

Across sectors like automobile, construction and real estate, e-commerce, logistics, educational services, FMCG, FMCD, healthcare and pharma, hospitality, industrial manufacturing and allied sectors, media and entertainment and retail and telecom, a fixed salary could make companies more selective and even cause them to hire more interns than ever before.

At a time when formal job creation should be the only agenda that drives any labour reform in this country, the labor code could make industries automating at a faster rate thereby further impacting job creation.

The impact of this will be the highest at the entry level jobs because that is where the salary is less than Rs. 18,000/-.

Following are the jobs that are likely to get impacted and their current median salaries:

Job Profile

Automobile & Allied Industry    Median Salary (per month)

Mechanic                                         Rs.9,000 – Rs.12,000

Operator                                          Rs.8,000 – Rs.10,000

Service Supervisor                           Rs.17,000 – Rs.22,000

FMCD

Loader and Picker                            Rs.8,500 – Rs.10,000

Packing Assistant                             Rs.8,000 – Rs.10,000

Wireman Control Panel                    Rs.10,000 – Rs.12,000

Module Assembly Technician            Rs.10,500 – Rs.12,500

Healthcare & Pharmaceuticals

Medical lab Technician                     Rs.12,500 – Rs.15,500

Diet Assistant                                    Rs.7,500 – Rs.10,500

General Duty Assistant                      Rs.8,000 – Rs.10,000

Field Service Executive                     Rs.10,500 – Rs.12,500

Media & Entertainment

Cable Operator                               Rs.11,000 – Rs.13,000

Technician                                      Rs.9,000 – Rs.11,000

Cable Boy                                      Rs.7,000 – Rs.9,000

IM&A

Admin Helper                           Rs.7,500 – Rs.9,500

Telephone Operator                   Rs.9,500 – Rs.11,500

Source: Team Lease Staffing Solutions

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