The word is out: India is moving up.
"We are due to see a surge in construction rates in India as it overtakes Japan to become the world's third largest construction market by 2021," says Graham Robinson, Executive Director, Global Construction Perspectives. This is one of the key findings of Global Construction 2030, a study that predicts that the volume of construction output will grow by 85 per cent to $15.5 trillion worldwide by 2030. China, US and India will lead the way, accounting for 57 per cent of all global growth.
Such a quantum leap in construction output will require the optimum utilisation of the skill sets of a committed workforce. But commitment runs both ways, and begs the question: How right are we doing by our 32 million construction workers?
In 2016, CW drew attention to the plight of our workforce in the feature "Act on Manpower", which highlighted initiatives towards skilling, shortcomings and offered recommendations to make India skill-efficient.
And now, criticising the "powers that be" for their apathy towards construction workers, the Supreme Court recently directed the Centre to frame a model scheme before September 30 to address their education, health, social security and pension concerns. Moreover, it expressed its concern that though over Rs 374 billion had been collected for construction workers, ostensibly only about Rs 95 billion had been used for their benefit.
This directive could not be more welcome. "There is a dire need to address the concerns of workers and their children," emphasises Manish Kumar, Managing Director & CEO, National Skill Development Corporation (NSDC). "Workers in the unorganised sector are deprived of welfare schemes, have lower job security and a lower chance of growth, often with no leaves and paid holidays.
They also have lower protection against employers indulging in unfair practices. Giving due recognition to the workforce in the unorganised sector is a prerequisite towards building a New India."
"As rightly observed by the Court, construction workers build not just infrastructure but also the nation," points out Dr Anoop Kumar Mittal, Chairman & Managing Director, NBCC.
"This model scheme is a crucial step towards accelerating their welfare benefits and providing them with vocational training and skill development."
"Such a scheme will motivate construction workers, enhance their lifestyles and safeguard their future," says Vishal Gupta, Chairman, CREDAI Skilling Committee. "Proper education and health benefits will also increase productivity."
"A model scheme will definitely help all stakeholders to be on the same page," opines Dr PR Swarup, Director General, Construction Industry Development Council (CIDC). "The benefits of any scheme lie embedded in its implementation; with cooperation from all stakeholders, the required objectives are easier to achieve. The quantifiable gains in the long term will be many but one needs to see the draft before making any projections." In his view, although the promulgation of health and safety policies by companies has wrought a sea change in working conditions at site and use of safety equipment, a lot needs to be done at the bottom of the pyramid.
"Social justice is the key essence behind this directive and it is encouraging for long-term sustainable and inclusive growth," says Neerja Singh, Director, Federation of Indian Chambers of Commerce and Industry (FICCI). "Access to basic instruments of well-being will ensure a healthy workforce with increased productivity; decreased healthcare costs, increased return-to-work rates, decreased disability and unemployment for health-related reasons, and prevention of illness. Education will help workers be re-skilled in the latest trends and technology and enhance their employability. All these factors will improve the speed, accuracy and timely delivery of projects." However, as she points out: "The implementation of the framework will remain key to the success of the scheme."
Indeed, implementation in India is the perennial deal-breaker that separates intent from reality. Take, for instance, the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996, and The Building and Other Construction Workers' Welfare Cess Act, 1996, both of which aim to augment the living conditions of construction workers and their families. The latter actually enables state governments and Union Territories to collect a cess from every employer to be used for the benefit of registered workers.
However, as the Supreme Court has pointed out, the benefits of such legislations have barely trickled down, prompting the recent directive. In fact, even two years ago, CW pointed out that if even 1 per cent of the total cess collected had been spent towards skilling, a huge number of labourers could have been skilled.
"A large amount of money collected for the welfare of workers from contractors and developers is lying unutilised with the government with a very small portion being utilised for their insurance and pension," says Ajit Gulabchand, Chairman, Governing Council, Construction Skills Development Council of India (CSDCI), and Chairman and Managing Director, HCC. "This has now been brought to the notice of the Ministry of Skill Development and the skill departments of the state governments for a part of this amount to be utilised for training and skill enhancement, which will help improve productivity and quality of output, in turn providing them a better life and helping India become a skill capital."
"As construction is the second largest employer in the country after agriculture, it is imperative to improve the welfare of construction workers," says Rajeev Bhatnagar, Head-Construction Skills Training Institute, L&T Construction. "However, while on one hand, the substantial funds collected by governments in the form of construction cess remain unutilised, on the other, construction workers welfare boards have failed to either propose viable programmes to utilise these funds or roll out workable schemes.
These funds can be utilised to provide higher grants to bodies like NSDC, CSDCI and state ITIs. And, being a relatively more accident-prone industry, the government could also consider providing additional insurance for workers from these funds."
"The utilisation of funds has been slow but it will not be proper to say benefits are being denied to construction workers," reasons Kumar. "In many cases, workers have received accidental cover for death or disability through the Pradhan Mantri Suraksha Bima Yojna, for natural death under the Pradhan Mantri Jyoti Bima Yojna, pension during old age under the Atal Pension Yojana, financial support for education, and more, through the Ministry of Labour & Employment. The Ministry of Skill Development & Entrepreneurship has also launched several programmes to enhance skills and employability; most of these are conducted on site, in partnership with employers. For the first time, a large number of workers have been certified for existing skills under the "recognition of prior learning' (RPL) component of the Pradhan Mantri Kaushal Vikas Yojana (PMKVY).
We plan to scale up this initiative in the current financial year through the CSDCI and training partners."
Kumar believes construction workers should be treated as part of the formal sector by bringing them within the ambit of social welfare laws and providing benefits like paid maternity leave, provident fund and minimum wage. "Vocational training and technological intervention could play a catalytic role in improving productivity and leading to cost-efficiencies, some which could be passed on to the workers in form of improve wages, paid leave, insurance, etc."
"The amendments to the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 and Building and Other Construction Workers' Welfare Cess Act, 1996 and Building & Other Construction Workers Related Laws (Amendment) Bill, 2012, aim to regularise the wages, working conditions, safety and health, and other welfare measures for workers," says Swarup. "A big gap between cess collection and its expenditure exists at this time, but with increasing awareness about labour welfare measures and boost for skill development, this will decrease. Training and certification, improving site conditions and labour camps, encouragement for future learning, constant skill upgrades for job value addition and medical and social benefits should become focus areas. As a large part of the workforce is migratory, their tracking through UIDAI and present engagements needs to be captured to ensure that welfare measures reach the beneficiaries and are not duplicated. Placing such data in the public domain will also reduce the demand-supply mismatch of certain skills in various locales in the country."
"We need to look out for the multidimensional vulnerabilities of the construction workforce and offer them benefits on the same lines as formal sector employees," avers Mittal. "In my view, the government's push with the Employees Provident Fund Organisation (EPFO) and Employees State Insurance Corporation (ESIC) is transforming this unorganised space to an organised one. These reforms are being implemented steadily with a focus on developing a national security scheme that will cover EPF, insurance for life and disability, old age and retirement benefits."
"The people employed in building and other construction works include workers from unorganised sectors who are often poor and oppressed," says Shobha Mishra Ghosh, Assistant Secretary General, FICCI. "To facilitate improvement in their conditions, it is important that the boards formulated by the government have adequate manpower with strategic and implementation skills to roll out the activities prescribed under the guidelines." Her recommendations for effective utilisation of the construction cess include hygienic living conditions near sites, financial assistance in case of accidents; disability pensions, medical expenses for major ailments, housing loan assistance, maternity benefits to female beneficiaries, educational incentives for workers and their families, facilities for crFches and toilets, marriage assistance, opening of mobile fair price shops, and much more.
Meanwhile, Arvind K Garg, President, Indian Construction Equipment Manufacturers Association (ICEMA), and Executive Vice President & Head-Construction & Mining Machinery Business, Larsen & Toubro, raises another point. "We are also not aware if these funds are available to machine operators and mechanics. This needs to be given wide publicity, especially through the various associations of equipment owners who are the major stakeholders in our sector." Considering the scarcity of skilled operators and mechanics, he believes job opportunities for them should be publicised and that funds can be utilised to set up training centres with good infrastructure to impart basic skills as well as subsequently upgrade their skills to higher National Skill Qualification Framework (NSQF) levels.
The skill shortage
Indeed, the need to skill the workforce cannot be overstated.
"With only 4 per cent of the workforce in India being skilled, there is a dire need for the government and other stakeholders to look into the matter on an urgent basis," agrees Gupta. "Compared to other countries like China (47 per cent), UK (68 per cent), Germany (74 per cent), Japan (80 per cent) and South Korea (96 per cent), the lack of skilled workers in India is an appalling statistic to behold."
"The workforce in India is facing significant shortage, especially in the skilled category," echoes Neeraj Bansal, Partner and Head-Building, Construction and Real-Estate Sector, KPMG. "Further, the sector is highly unorganised. About 80-85 per cent of the workforce in the construction sector is estimated to be unskilled and migratory in nature. The high level of unskilled labourers is leading to significant inefficiencies. According to the RBI, the value-addition in the construction sector has declined in the past 10 years and is now only slightly better than the agriculture sector. With an additional labour requirement of about 15-20 million in the next five years, we urgently need to produce a skilled workforce for the construction sector to grow."
"The construction industry has a dearth of sufficient trained and skilled manpower in various trades," affirms Mittal. "This has often resulted in slowdown of projects and escalated project costs. Given the labour-intensive nature of the industry and to create a dynamic, focused workforce to reap the benefits of India's demographic dividend in years to come, we need to harness and channel the talent of young Indians. The present government is aware of the issue as can be gauged from its skill development programme. Also, we must upgrade ourselves with innovative building technologies and new materials. In such a scenario, skill development will play a major role."
"The acute shortage of skilled construction labour, especially in the metros and economically developed states, is of two distinct types," elaborates Bhatnagar. "First, there is shortage in the trades available within the country. Second, there is severe shortage in trades connected with emerging technologies like smart cities, solar energy, water and mechanised transportation projects." In his view, this demand can only be met through financial support to training bodies like NSDC, CSDCI; the revamping of ITIs and the vocational training system; and increased funding for the National Apprenticeship Promotion Scheme (NAPS).
In the infrastructure equipment segment, too, close to 70 per cent of the workforce is in the unorganised sector, according to Garg. "Further, the job roles of machine operators and, to some extent, mechanics are non-aspirational," he says. "Most important, there is no mandate for our machines to be operated and serviced only by trained and certified personnel, as is the case in most other countries. In the absence of many formal training centres, unskilled operators face challenges to learn and operate the most modern machines. This is the biggest drawback for effective project implementation." To address this issue, ICEMA in proposing necessary regulations through the Construction Earthmoving Mining & Material Handling Machinery Act (CEMM), now in an advanced stage of consideration by the Union Government. "This Act on fructification will be a game-changer, where the demand for skilled and certified personnel will go up exponentially."
Meanwhile, Swarup says, "As labour becomes scarce, technology is coming to the rescue. A quick calculation reveals that 83 per cent of the labour force in construction is either semi-skilled or unskilled.
With initiatives like Skill India and emphasis on RPL, significant changes are happening. To adapt and deploy technology successfully, companies need to re-jig their labour policies with due emphasis on skilling the labour force, existing and new, in emerging technologies."
Initiatives on the ground
Evidently, the government and stakeholders are aware of the problems and are now working towards solutions.
As Kumar tells us, the Ministry of Labour and Employment has proposed a comprehensive social security system to provide retirement, health, old age, disability, unemployment and maternity benefits to 50 crore workers in the country. The National Social Security Council will regulate and monitor the scheme, which will be implemented in three phases over the next 10 years. In the first phase, which will cost Rs 185 billion, workers will receive health security and retirement benefits, while the second phase will include unemployment benefits. The target beneficiaries: People below the poverty line and those in the unorganised sector.
"To achieve the Prime Minister's vision of making India the skill capital of the world, NSDC has focussed on catalysing the creation of large, quality and for-profit vocational institutions across the country," he adds. "Further, NSDC gives funding to build scalable and profitable vocational training initiatives and provides knowledge, content and infrastructure support to organisations that provide quality skill training.
It also develops appropriate models to enhance, support and coordinate private-sector initiatives." Moreover, NSDC works closely with the Ministry of Skill Development & Entrepreneurship to execute flagship programmes such as PMKVY, Pradhan Mantri Kaushal Kendra and NAPS, among others.
For its part, CIDC has been a pioneer since 1998, having trained, tested and certified over 5 lakh workers. "Many of them have carved a niche for themselves and continue to serve the industry," adds Swarup. "Many have travelled overseas for work and many are self-employed. On-the-job training, constant audit of skill, training of trainers and focus on hands-on training are some features that define our methodology and are in alignment with the Skill India mission." At present, CIDC is actively working with leading government bodies and PSUs, including AAI, EIL, RECL, PFCL, HUDCO, SJVNL, EPIL, NPCIL and the Governments of Rajasthan, Tamil Nadu, Jharkhand and Andhra Pradesh to provide job-oriented training. It also helps corporates set-up dedicated training centres on site and undertakes assignments for RPL.
Since its foray into skilling in 2011 with its training programme, "Kushal', through its Pune Chapter in collaboration with NSDC, CREDAI has been conducting regular on-site programmes for construction workers at various sites through its member developers, spread across 23 states and 189 city chapters. "CREDAI has trained over 1 lakh construction workers in over 500 construction sites across 55 cities in India," says Gupta.
It has also started to undertake skilling at source at off-site centres.
The programme trains unemployed youth and then ties up with labour contractors to deploy them at CREDAI's sites. "Over 2,500 workers have been trained in masonry, bricklaying, tiling, bar bending, shuttering carpentry, electrical and plumbing. Once trained, they are facilitated in obtaining employment at our members' sites across the country through labour contractors at better wages." CREDAI is also developing a mobile app in association with CSDCI to link off-site skill trainings and placements.
CSDCI has already developed National Occupational Standards (NOS) û 101 skills (qualification packs, or QPs) under 17 occupations û for the sector and will add many new QPs during this year, shares Gulabchand. In fact, CSDCI has partnered with over 350 training providers, more than 800 assessors and over 2,000 trainers for training and assessments. "It has trained more than 1.5 lakh workers in the last financial year under various programmes."
"There is a lot riding on NBCC to lead from the front and evolve industry-competent skill development programmes," says Mittal. The company currently executes various training programmes to empower individuals left out of mainstream education system; candidates who complete approved training programmes are often recruited as junior executives, ultimately being employed in the company. It also utilises its CSR funds to run a "Skill & Entrepreneurship Development Programme' across India. "NBCC is embarking to develop SDI Bhubaneswar as the country's most promising skill academy in the line with the government's Skill India mission," he reveals. "Further, we have pledged to impart training to 40,000 workers (onsite and offsite) in the next five years."
Meanwhile, L&T, a pioneer in skilling with the establishment of its first Construction Skills Training Institute (CSTI) in 1994, is continuing the good work. "At present, L&T has eight CSTIs, with the ninth institute recently opened for training of technicians for smart cities and yet another one for training technicians for transportation infrastructure under construction," says Bhatnagar. In all these institutes, training, assessment and certification facilities are provided for 17 occupations covering 45 job roles; the same standards available with NSDC and CSDCI are implemented. Other innovative steps by the company include the development of e-learning modules in nine occupations that provide standardised training from workmen to engineers; simulators for trades like bar bending, pipe cutting, and welding to familiarise workmen in handling sophisticated machines; and skill training for women construction workers.
As for the construction equipment sector, ICEMA is playing its part - in late 2004, it promoted and supported the formation of the Infrastructure Equipment Skill Council (IESC) to spearhead the skilling of workforce in the industry, focusing initially on training and certification of operators and mechanics. "IESC has developed standards covering over 80 per cent of the workforce, accrediting training partners and empanelling experienced trainers to deliver quality skill training, pan-India," Garg informs us. "It has trained over 6,000 personnel so far and is poised to scale up its operations."
In fact, IESC has signed MOUs with several state skill development missions and AICTE colleges and is working with entities like Coal India, NHIDCL, MOIL, NALCO and the National Highways Authority of India (NHAI) as well as the Indian Army. It has also signed an MoU with the National Highway Infrastructure Development Corporation (NHIDCL) to skill operators on road projects in the arduous terrain of the Northeast and is collaborating with NHAI to establish model training centres across the country; initial progress has been made on the Bharatmala project with the involvement of the Ministry of Skill Development & Entrepreneurship.
"ICEMA is working in close tandem with equipment insurance and financing companies to offer incentive schemes to machine owners employing only IESC-certified personnel," adds Garg. "IESC has also affiliated private training partners who have shown keen interest to promote training under PMKVY; this is beneficial to less privileged candidates from catchment areas from villages and many trained personnel have been employed."
What's more, IESC has developed 33 job roles covering over 80 per cent of industry requirements and is in the process of taking approval for an additional six job roles, covering all the current equipment sold in India. The QPs and National Occupational Standards (NOS) are drawn with the involvement of the user industry, manufacturers and the government; these QPs will undergo revision once in two years.
The way forward
Evidently, work is in progress - but much more needs to be done.
As Kumar iterates, "The total employment generated in the construction sector is currently 56 million, which is likely to be around 79 million by 2022.
Of these, 97 per cent of workers between the ages of 15 and 65 are likely to have no formal training before they start working, leading to lower productivity, fewer wages and adverse impact on the quality of work. NSDC plans to expand training capacity in this sector and further standardise training content through the CSDCI. It is also working to create a strong pool of trainers and assessors."
Based on the experts interviewed for this story, CW has drawn up a list of recommendations that will help India realise its place in the construction sun, so to speak!
Recommendations for the Way Ahead