LABOUR INCENTIVE SCHEMES IN SSI SECTOR: A CASE STUDY

Abstract

Incentive schemes act as external stimuli. They induce workers to excel and earn more than the normal wages. Therefore, well-drafted incentive schemes bring gains to all, i.e., both to the employers and employees. These schemes have universal application, in the sense that they can be applied in all forms of business organizations, be it big or small, high-tech or labour-intensive, etc., though the structure and complexities of the schemes may vary from a small enterprise to a big enterprise. The present research paper aims to evaluate the labour incentive plans of SSI sector in a selected area. The SSI units are labour-intensive and provide gainful employment to lakhs of low-educated, unskilled and semi-skilled workers. The operational efficiency of these units depend on the efficiency rate of their employees. In view of this, incentive schemes become essential. The study looks at the existence, structure and cost of incentive schemes in Hubli-Dharwad area of Karnataka State. The study finds that incentives schemes are yet to make serious inroads into SSI sector and only 68 percent of surveyed units employ them. The schemes employed are simple, monetary and individual-oriented in nature. The cost of incentive schemes does not exceed 5 percent of total labour cost in majority of units employing such schemes. The study also finds that there is no statistical relationship between educational qualification level of entrepreneurs and the adoption of incentive schemes but the educational level becomes important in deciding the structure of incentive schemes. The study concludes by providing some useful suggestions for the adoption and operation of incentive schemes in SSI sector.