How does supply and demand connect in Indian labor markets?

The paragraphs below explain how unskilled labor markets/exchanges are created in town centers in india,

Shortage of Laborers Plagues India: Skills Gap Drags Down Economy; By ERIC BELLMAN and JACKIE RANGE; May 1, 2008; Page A1

The surging demand for labor can be seen at the morning “Naka,” or labor market, of Vashi, a growing Mumbai suburb. More than 2,000 construction workers crowd onto the same corner each morning at 8:30. Skilled workers stand behind the tools of their trade: pipes for plumbers, brushes for painters, long leveling boards for concrete and bricklayers. The nomad women from Rajasthan, marked by their mirrored skirts, are usually tapped for tiling.

Contractors, recognizable from their gold rings and cellphones, dive into the crowds and place orders for skilled and unskilled workers. Those interested swarm around the contractors, negotiate a daily wage and then leave for building sites. Most of the workers are gone before 11 a.m.

There are hundreds of Nakas across Mumbai, and there have been for decades. But recently, there’s been a sharp rise in pay and expectations. Wages for some skilled laborers have more than doubled in the past two years to more than $10 a day. Unskilled laborers are making around $2.50 a day, about 50% more than before.

Workers have become pickier, says contractor Mantesh Jamadar, who comes to the Vashi Naka every morning. Many skilled workers don’t even show up at the morning market any more, he says. Instead, they have cellphones, and contractors make appointments to see them. “They used to go anywhere for work but now they refuse to travel,” Mr. Jamadar says.




One Response to “How does supply and demand connect in Indian labor markets?”

  1. Jennifer Lancey Says:

    Hello there. I was sent a link to your blog by a friend a while ago. I have been reading a long for a while now. Just wanted to say HI. Thanks for putting in all the hard work.

    Jennifer Lancey

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