Construction labour migrants and wage inequality in Kerala
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Construction labour migrants and wage inequality in Kerala Jajati K. Parida1 · Merry Elizabeth John2 · Justin Sunny3
© Institute for Social and Economic Change 2020
Abstract This study explores the patterns and determinants of construction-led migration and measures the existing wage differential between migrant and native workers in Kerala using both secondary and primary data. While secondary data were compiled from Census and NSS migration surveys, primary data were collected from three districts of Kerala using a stratified random sampling method. It is found that the pattern of internal migration is changing in Kerala with a declining share of migrants from neighbouring states, along with the corresponding upsurge in the inflows from far-off states like West Bengal, Assam and Bihar. Though poverty and rising unemployment at the place of origin are the pushing factors, relatively higher wages and availability of employment throughout the years are the main pulling factors of in-migration to Kerala. Since a higher proportion of remittance is spent on basic necessities like food, clothing and housing consumptions, it has positive implication on poverty reduction at the origin states. However, it is noted that migrant workers, on the average, earn less than their non-migrants counterparts in Kerala. Given the importance of these low-skilled migrants in sustaining the long-term economic growth in Kerala, their poor and unhygienic living arrangements should also attract the attention of the policy makers. Keywords In-migration · Construction sector · Wage differentials JEL Classification R23 · L74 · J31
Introduction The increased Gulf emigration for construction and other low-skilled jobs during last five decades (see Osella and Osella 2000; Zachariah et al. 2002; Rajan and Kumar 2010; Raman 2012; Zachariah and Rajan 2012; 2016; Parida and Raman 2018) decreased the supply of low-skilled labour in Kerala. Moreover, the large scale inflow of remittances and * Jajati K. Parida [email protected] 1
Department of Economic Studies, School of Social Sciences, Central University of Punjab, Mansa Road, Bathinda, Punjab 151001, India
2
University of Limerick, Limerick, Ireland
3
Trivandrum, India
13
Vol.:(0123456789)
Journal of Social and Economic Development
thereby the improved household standard of living, also caused a decline of the domestic labour supply due to negative income effect (see Mehrotra and Parida 2017). But, the inflow of remittances, on the other hand, increased the household level investment on housing substantially (see Sunny et al. 2020), and hence the demand for low-skilled construction workers increased substantially in Kerala. The rising demand for low-skilled worker, on the one hand, and their declining supply due to improved living standard, on the other, created a gap. To fill this gap, people from both neighbouring states and from relatively poor and backward states of the far-off Eastern part of India moved to Kerala for employment opportunities at relatively higher wages (
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