Stagnation of Real Wages
Real wages for salaried jobs have been stagnating since 2019.
In the June 2024 quarter, real wages were 1.7% lower than in 2019, reflecting the negative impact of inflation.
Factors like oversupply of labor and declining returns on higher education contribute to wage stagnation.
Wages for Casual Labor
Real wages for casual labor have seen significant increases (12.3% higher in June 2024 compared to 2019).
While this rise seems positive, casual labor remains irregular and insecure work, which is not ideal for long-term economic stability.
Self-Employed Workers’ Wages
Wages for self-employed workers have picked up since 2022 but remain 1.5% lower than in 2019.
Rise in self-employment, especially in rural areas, reflects distress and low returns, with many working as unpaid helpers in family businesses
Structural Challenges and Policy Impact
Demonetization and GST implementation have negatively affected wages and employment.
Despite economic growth, low wages, particularly in the informal sector, are limiting consumption, which is crucial for economic growth.
Experts agree that without increased private investment and wage growth, significant improvements in wages are unlikely.
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