Another labour crisis looms as workers return home | Economic Times

Several sectors could face labour shortage as the second Covid-19 wave and fears of even more stringent restrictions force workers to leave the big cities for their homes. Sectors such as construction and real estate, manufacturing and industrial, healthcare and pharmaceuticals, power and energy could be gripped by another labour crisis, said economists and industry experts. The next three to four weeks will be crucial, they said.Teamlease Services data already show a labour shortage of 5-10% in these sectors. The gap may widen if uncertainty about business operations persists, more restrictions are imposed and the spiralling number of cases is not brought under control, experts said. 82191015“Organisations dependent on migrant labour had not fully gotten back the workforce which they had lost during the first lockdown,” said Rituparna Chakraborty, executive vice-president, Teamlease Services. “Over the past three to four weeks, some have witnessed depletion in certain pockets of the country on account of the second wave.”While this hasn’t reached a level where it starts to hurt, things could change rapidly if restrictions get more stringent in the next few weeks, she said.“There is a panic that is setting in among labourers and workers, who have seen what happened to them during the lockdown last year,” said CARE Ratings chief economist Madan Sabnavis, who sees the crisis deepening.The nationwide lockdown imposed at short notice last year had forced hundreds of thousands of workers to stream out of cities on foot, as their jobs dried up.“The moment there is an announcement of lockdown, panic sets in, and it impacts both enterprises and labour — in large companies as well as MSMEs (micro, small & medium enterprises),” said Sabnavis. “There is a lot of uncertainty about how long the clampdowns may continue, how long it will take for the infection spread to be brought under control, and what its impact will be on businesses.”Some experts said the crisis is more in services — hospitality, gyms, restaurants, salons, entertainment, malls and restaurants — as it’s the first target of any lockdown and the last to open up.“Some people who are leaving are mostly due to seasonal migration that happens every year before the monsoon,” said Niranjan Hiranandani, managing director of Hiranandani Group, a real estate developer. “Otherwise, in the real estate and construction sector, there is no impact yet because construction work is continuing.” Several workers in hospitality, restaurants, travel and various other temporary roles in some of the hard-hit sectors are panicking and leaving, Hiranandani said.Tata Steel said workers at some of its outsourced processing centres are moving back home. “But this is just a trickle and nowhere compared to what we saw during the first lockdown,” said a company spokesperson.KEC International, a leading power transmission engineering, procurement and construction company, has seen some people leaving project sites, where the total number of workers has come down to 21,000-21,500 from 23,000.Vimal Kejriwal, chief executive, KEC International, attributed this to mostly seasonal migration and said there is no pressure on workers to leave as yet. “Now that we have gone through this one year before, we are better prepared to handle the situation,” he said.However, all will depend on the nature of the disease surge, lockdowns and how prolonged they will be, said experts.“Currently, we are operating at 100% capacity,” said the Tata Steel spokesperson. “These are unprecedented times and the situation on the ground is evolving rapidly… We are continuously monitoring the situation and stand ready to review our decisions based on the developments on the ground.”