Over the last two decades, we have witnessed massive shifts in the global economy. Technological and organisational changes in manufacturing have led to increased out-sourcing of labour-intensive processes. This has occurred in Northern countries and, increasingly, in developing countries. In this time, in the name of labour flexibility, the labour market has become more informal and less regulated. Labourers in many parts of the world compete with each other for work, as companies relocate and outsource production and services wherever costs are most competitive. Industries and hence work comes and goes, which leads to decreasing protection for workers through formal institutions. With few protections and a glut of people who need jobs, collective organizing of workers has become increasingly difficult. These trends are likely to persist, as long as trade liberalization under regimes like the WTO enables corporations to continue unfettered profit-seeking, and as long as citizens, rich and poor alike, do not successfully institute structural changes in the market economy through an effective regulatory framework.
For the working poor, the impact of this informalisation cannot be underestimated. This trend means that the poor are increasingly limited to finding work as daily wage labourers, casual labourers, or home-based piece-rate workers, in which the work is difficult and often dangerous, and in which formal labour protection is lacking. In India, decent work is scarce, and accessibility limited to a small minority of the Indian workforce (approx. 10%). In the informal economy, which absorbs the remaining 90% of the workforce, workers usually are paid less than minimum wage. Working hours are irregular and often excessive, and work insecure. Small enterprises and informal sector workers have little access to training, capital, or any form of social protection. They often rely heavily upon intermediaries for access to orders. Contractors, themselves a part of the outsourcing chain, often operate in a very exploitative and insecure environment. In this environment, they are apt to take advantage of the large supply of workers and small enterprises willing to execute the orders. This further aggravates conditions for workers in the informal economy. Perhaps most importantly, while poverty and the forces underlying market realities in the informal economy are systemic, people perceive their problems as individual misfortunes. Simultaneously, the working poor have no power to negotiate collectively in order to change the existing structures and labour market realities.
