Labour reforms
India aspires to be a hub for large-scale, labour-intensive manufacturing and services, creating mass employment to leverage its young demographic. Yet, 80% of enterprises employ fewer than 100 workers, and 80% of adults work informally. This economic “dwarfism” stems from restrictive labour regulations, which hinder formal job creation. Labour laws account for 47% of all compliance requirements, burdening businesses with high costs or pushing them into illegality. The Economic Survey 2018-19 highlights that states with rigid labour markets struggle to generate employment.
Recognising this, the Union and state governments have initiated labour reforms. The 2020 Labour Codes consolidated 40+ laws, and states like Punjab and Uttar Pradesh are amending acts like the Factories Act to attract investment. Seven states have undertaken reforms in the last five years, signalling a vital opportunity for systematic change. Prosperiti partners with state governments to liberalise labour laws.
State of Discrimination Report 2022
More than 250 regulations across Indian states prevent women from choosing to work. Women often cannot work after 7 PM or in 217 different factory processes across 82+ industries. These restrictions make competing in the labour market difficult for women, adding to the challenge of bringing them into formal high-paying jobs. If Indian women participated in the labour market at the same rate as men, over 200 million more women workers could be employed. Please write to us at info@prosperiti.org.in to access the datasets linked to the report.
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