Last Sunday’s Economic Times carried a opinion piece titled “Ending the Ovarian Lottery” by Manish Sabharwal, the Chairman of TeamLease Services, the country’s largest temp staffing agency. In the op-ed, he calls for a national policy on making India’s labor markets more inclusive to address the inequalities created by the ovarian lottery (a persons earnings potential is still limited by where he or she is born – in India’s case mainly urban vs. rural):
Inequality is a tragedy. But I couldn’t agree more with economist Arvind Panagariya who in his brilliant recent economic history of India writes that targeting the five kinds of inequality (income distribution, regional disparities, urban versus rural, unorganised versus organised employment, skilled versus unskilled) is the weaker policy prescription.
A more effective policy response would be making labour markets more inclusive and improving the capacity of labour market outsiders (less educated, less skilled, first-time job seekers, people from small towns, women, retired people, etc) to take advantage of India’s new tryst with destiny.
In the short run we can’t take jobs to people; we need to take people to jobs. This means creating the processes, institutions and framework for labour migration. This is sacrilegious to the many who believe that keeping people in villages is a policy imperative because of urban decay and quality of life.
I strongly recommend reading the entire piece. Quite powerful words, especially coming from head of a company which is slated to become the country’s largest private employer. I presume TeamLease’s model is strongly dependent on sourcing talent from outside the metro’s – which is also reflected on Manish’s stand on taking people to jobs vs. taking jobs to people. While I agree with his argument that keeping people in villages is unrealistic and unfair, at the same time, the expansion of India’s few largest cities is clearly unsustainable both in the short and the long run. The solution might be to focus on the next layer of cities, which can act as local economic engines and spread the focus away from the big metros.