Rajkot SMEs faced with labour shortage problem

Despite a good growth rate and increasing job opportunity Rajkot based small scale industries are facing labor shortage by more than 50 percent as labor supply from outside of Gujarat and small villages has come down.

Rajkot that was mainly known for its diesel engine, auto parts and machine tools industries and has more than 4000 small and medium scale engineering units used to give employment to around 1.25 lakh people. This number has come down considerably since last couple of years as these small units are facing short supply of labor.

"Most of the labor in Rajkot comes from Bihar, Uttar Pradesh and Orissa, but as industrial and infrastructure developments also taking place in these states so workers are going back to their home town or state. It has created a labor crisis for Rajkot based Industries", said Dhansukh Vora, President, Greater Rajkot Chamber of Commerce and Industries (GRCCI).

According to Vora, Rajkot, which is well-known for its foundry and automobile engineering industries, and has more than 125,000 workers connected with the engineering industry. Out of these, 50 percent labor come from out of Gujarat. Parag Tejura, President of Saurashtra Vepar Udhyog Maha Mandal said, "Another cause of concern is that local labor has also shifted from engineering industries to construction labor work as they are getting almost double of what they used to make in engineering work. On an average a labor worker gets Rs 100 to Rs 259 per day in any engineering company but in construction work worker gets Rs 300 to Rs 500 per day.

"Industrial development is developing well in states like Bihar and Uttar Pradesh. Moreover the Government also runs the National Rural Employment Guarantee Act (NREGA) that aims at providing employment in the home state for migrant workers which is also a reason those migrant laborers prefer to work near their native state now," said Bharat Davda of The Energy and Resources Institute (TERI), Rajkot.

According to industry sources, good farming conditions prevalent in Gujarat are also considered as one of the reasons of short supply of labor. Labor that comes from villages are now busy with farming as since last two to three years good rains in the state have given a boost to farmers. On fielding a query on how the industry plans to face this labor shortage problem Dhansukh Vora added, "Automation is the best way to reduce this problem. Small and medium companies have to work on decreasing labor in their units. Many big companies are doing the same to bring down the dependence on labour. Technical up-gradation can help the industry but it is a costly solution for small players as finance needed for automation is not easily available. But the future is definitely moving towards automisation."