Rural Wages | Economics Optional Notes for UPSC PDF Download

What are the Findings?

Agricultural Workers:

• In rural areas of Madhya Pradesh (MP), male agricultural laborers received a daily wage of only Rs 217.8, while in Gujarat, it amounted to Rs 220.3 for the year ending March 2022.
• Daily wages in both states fall below the national average of Rs 323.2.
• Kerala stands out for having the highest-paid agricultural workers, with an average wage of Rs 726.8 per worker.
• The attractive wages in Kerala have led to an influx of farm workers from other states with lower wages, with approximately 25 lakh migrant workers reportedly residing in the state.
• In Jammu & Kashmir, farm workers earn an average wage of Rs 524.6, while in Himachal Pradesh, it is Rs 457.6, and in Tamil Nadu, it is Rs 445.6 per person.

Non-agricultural Workers:

• For male non-agricultural workers, the lowest wage was recorded in MP, with an average wage of Rs 230.3, while workers in Gujarat earned a daily wage of Rs 252.5, and those in Tripura earned Rs 250 — all below the national average of Rs 326.6.
• Kerala once again leads in wages for non-agricultural workers, with an average of Rs 681.8 per person.
• Following the year ending March 2022, Kerala is followed by Jammu & Kashmir, Tamil Nadu, and Haryana.
• Gujarat and Madhya Pradesh remain below the national average of Rs 373.3 for rural male construction workers.
• Rural construction workers in Gujarat received an average wage of Rs 295.9, in MP Rs 266.7, and in Tripura Rs 250.

Construction Workers:

• The daily wage for rural construction workers was Rs 837.7 in Kerala, Rs 519.8 in Jammu & Kashmir, Rs 478.6 in Tamil Nadu, and Rs 462.7 in Himachal Pradesh.

What are the Issues associated with Rural Wages?

• Rural jobs are dependent on agriculture which in turn is influenced by monsoon and rabi and kharif production.
• Low agricultural prices contribute to lower incomes in rural areas.
• Most new jobs in the rural areas are for unskilled workers, so the wages and nature of the work are unattractive.
• There is a strong gender disparity, where the female worker is paid only 70% of what the male worker earns.
• Productivity increases without wage increases could offset the impact of real wage increases on welfare.

Way Forward

• Addressing the challenge of generating quality employment for its expanding youthful population requires a comprehensive approach, encompassing investments in human capital, revitalization of productive sectors, and initiatives to foster small entrepreneurship.
• Incentives should be extended to rural food processing industries, and efforts should be directed towards optimizing value chains that seamlessly connect processing with transportation. Exploring the potential of contract farming and establishing direct links between farms and factories can significantly contribute to rural income security.
• Critical elements for success include digitalization in rural areas and local e-governance, forming the foundation for empowering 650,000 villages and 800 million citizens towards self-sufficiency. The establishment of a rural knowledge platform, achieved through collaborative efforts between the public and private sectors, holds the promise of bringing cutting-edge technology to the grassroots, thereby creating employment opportunities.
• The integration of Artificial Intelligence can play a pivotal role in facilitating intelligent and precise agricultural practices, adding a layer of innovation to the rural landscape.