Abstract

The employment structure of the Indian economy has been undergoing certain changes with globalisation. It has made competition an important component for the development, expansion and growth of industry. In this context, low labour cost, along with flexibility in labour use, inter alia, have become key sources of competitive advantage for firms. Moreover, location decisions of international investors are increasingly guided by the availability of cheap labour and the scope for informal employment arrangements. These developments have had varied implications for labour, employment and industrial relations. The nature of employment is changing, with new employment created in the economy being largely contractual, that is, in the nature of a client-supplier relationship, where employment is offered not as an appointment but as an assignment. The present paper, therefore, examines the implications of a more flexible labour market on the quantity and quality of employment by taking the case of India’s manufacturing sector.