Economic Efficiency of Labour in Indian Manufacturing Under Various Policy Regimes: 1980-13

Abstract

The utilization performance of labour in Indian manufacturing has been analyzed through the discrepancy between potential and actual labour productivity for the period 1980-13. It has been observed that impressive enhancement in labour productivity growth has been taken place in some of the states in Indian manufacturing during the period of consolidation of economic reforms 2001-13. Remarkable enrichment in capital productivity growth has been taken place in most of the states in Indian manufacturing during the period of consolidation of economic reforms 2001-13. The comparative analysis of growth pattern of capital intensity between a phase of major changes in economic policy 1991-01 and a period of consolidation of economic reforms 2001-13 highlights that the a greater labour absorption during the period of consolidation of economic reforms 2001-13. On the whole, the industrially developed states performed much better in the use of labour input in recent years. Labour efficiency index has been positive at aggregate manufacturing during 1991-01 and 2001-13 whereas it has been negative during 1980-91. It indicates that the impressive enhancement in labour utilization performance has taken place in Indian manufacturing at aggregate level on account of industrial reforms since 1991.