Welfare scheme benefits causing labour shortages in construction: L&T MD

Addressing the CII Mystic South Global Linkages Summit, L&T's MD noted that despite the crucial role of construction in national development, the industry is struggling due to a lack of workforce

Larsen & Toubro’s Chairman and Managing Director SN Subrahmanyan has said that increasing labour shortages in the construction sector is because of the benefits provided by various welfare schemes.

 

Addressing the CII Mystic South Global Linkages Summit in Chennai on Tuesday (February 11), Subrahmanyan noted that despite the crucial role of construction in national development, the industry is struggling due to a lack of available workforce.  

 

Subrahmanyan pointed out that while many countries deal with high immigration rates, India faces a unique challenge — many workers are unwilling to relocate for employment. He also spoke about the difficulties in "mobilising labour."  

 

'Challenges in workforce mobilisation'  

 

Subrahmanyan explained that L&T requires around 400,000 workers, but with attrition occurring three to four times a year, the company ends up employing approximately 1.6 million people annually, according to a report in The Financial Express.

 

He highlighted the challenge of mobilising workers for large-scale infrastructure projects. “Imagine having to mobilise 1.6 million people every year,” he said, emphasising the need for a dedicated human resources division for labour recruitment.

 

Subrahmanyan suggested that several government initiatives, such as the Jan Dhan bank accounts, direct benefit transfers under the Garib Kalyan Yojana, and employment through MGNREGA, may have reduced the incentive for workers to seek jobs far from their hometowns. According to him, this issue is not limited to manual labour but extends to engineering roles as well, where professionals often prefer to stay in their native cities rather than relocate.  

 

'Shift in work culture'

 

Comparing current workforce attitudes with previous generations, Subrahmanyan observed a shift in work culture, noting that younger employees are more likely to challenge authority, according to a report in The Economic Times. He acknowledged the need for businesses to adapt to these changes, stating that industries must “live with this world and have policies that understand this and take it forward.”  

 

Additionally, he pointed out that while India is struggling to mobilise its workforce, opportunities in the Middle East are expanding. “Our backlog there is upwards of $22 billion, and in another three months, it can be $30 billion,” he noted, explaining that workers often prefer jobs in countries like Saudi Arabia, Oman, Qatar, and Kuwait, where salaries are significantly higher than in India.  

 

To address these challenges, L&T has been investing in skill development through its corporate social responsibility (CSR) initiatives. Subrahmanyan detailed efforts such as building schools, providing vocational training, and engaging with communities to create a positive perception of the company. “We are putting some of the CSR budget into villages and towns... so that an environment is created, by which they tell their menfolk that this company is good to go and work at,” he explained.  

 

Highlighting the importance of infrastructure growth, Subrahmanyan concluded that despite these challenges, India must continue its efforts in development. However, without sufficient labour availability, the pace of construction projects could be significantly hindered.

 

Subrahmanyan's '90-hr work week' remark

 

Few weeks ago, Subrahmanyan sparked online outrage after his undated video advocating a 90-hour work week went viral. In the viral video, Subrahmanyan can be heard suggesting that employees should even give up Sundays. "How long can you stare at your wife," he asked.

 

“I regret I am not able to make you work on Sundays. If I can make you work on Sundays, I will be more happy, because I work on Sundays. What do you do sitting at home? How long can you stare at your wife? How long can the wives stare at their husbands? Come on, get to the office and start working," he added.

 

When his comments received flak online, the company, in its response, said that Subrahmanyan's remarks were "casual in nature" and "misinterpreted."