Globalization and Labor Standards

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Globalization is an important factor behind the high rate of labor standards in India. The economic liberalization policies, the economic and market growth and the trends of globalization have really made India into a vast consumer market which has increased demand to a great extent. All these factors have positively affected the rate of labor and employment in the country.

Economic liberalization and labor standards

Prior to the economic liberalization policies, employment in India was mainly based on the government and public sector. Most of employment used to be generated in various government enterprises, banks, financial organizations and public sector units. This led to high scale red-tapism, License Raj and other problems of workforce. The standard of labor significantly started getting worse and there were constant labor problems, lockouts, strikes and so on. Due to all these factors, the overall work culture and the labor situation in India suffered a set back.

It was in the 1990s that the economic liberalization policies were first undertaken by the government. The shift towards these open market policies really did a lot to bring about a change and make the country into a vast consumer market. The Gross Domestic Product as well as the exports started increasing significantly. This shift towards the consumer market and the demand supply chains led to the growth of various sectors which provided the scope of employment in the country. The open market economy also gradually led to the growth of the private sector which provided ample employment scope for the skilled workforce. Since then, the job prospect in India has really grown up over the years.

New segments in the market

Globalization and labor standards were also favorably affected by the entry of new segments in the market. Due to high demand and the consumer market, more and more sectors have entered into the market of the country. Some of the well known sectors that have been successfully operating their businesses are Information Technology, agro products, health care, beauty and personal care and so on. All these sectors have led to high demand which has improved the overall labor standard of the country.

Labor standards have also increased in the unorganized sector as well. Recent surveys have shown that there has been an improvement in the standard of living of the people who are working in the unorganized sector. The pay package and the labor benefits in the unorganized sector have also improved to a great extent.

Today, the three main sectors in India are the service sector, agricultural sector and industrial sector. The share of the service sector is around 54% of the annual Gross Domestic Product (GDP). The agriculture sector and the industry sector also contribute around 17% and 29% to the annual GDP. Over the years, these sectors are expected to increase more and add to the revenue of the country.

Improvement in the standard of living

Globalization has also led to the growth of the standard of living in the country. This has put a favorable impact on the overall labor standards in the country. With the rise in the civic amenities and the improvement in the health care sector, the standard of living has also improved. Improvement in education has also given rise to skilled workforces who are very much suited to the changing trends and needs of the market. According to recent surveys, the standard of labor in both the organized as well as the unorganized sector has improved to a great extent.

Initiatives of the government

Various initiatives of the government have also provided a fillip to the labor standards in India. The government has started a number of employment programs like CM Rojgar Yojna and Prime Minister Rojgar Yojna to help the employment people in the country. Stress is also being given to improve the quality of labor in the government and the public sector units. The Minimum Wages scheme has also been very successful in the rural areas.

Bank of America

Last Updated on 5/18/2011