Job Loss and Job Opportunities of Factory Workers in Ahmedabad: Flexible Labour Rethink

Abstract

In the globally expanding market economy, many developing as well as advanced countries have exerted a keen effort to implement labour reforms as one of their measures to adapt to the global economy and to succeed in the highly competitive environment. One among those countries is India. Since the inception of economic reforms in India in the 1990s, there has been much discussion in particular concerning the amendment of the labour laws, such as the Industrial Dispute Act which restricts the free layoff, dismissal and closure of firms employing 100 or more workers, the Contract Labour (Regulation and Abolition) Act which prohibits employment of contract labour in any specific process or operation, and the Factory Act which prohibits women from working at night, and so forth. It has been argued that labour market flexibility should be produced by deregulation of the protective regulations, among other means, based on the premise that the rigidity in the labour market due to these labour-protective laws has not only hindered the efficient allocation of labour resources but has also led to increased labour costs and consequent employment constraints on management, and as a result, has hindered further employment generation. Thus, labour flexibility has become one of the focuses of the labour reforms.