How much does Manpower cost while manufacturing a
product ?
Although over-simplified , here is a broad framework
:
Ø Product
Cost =
Cost of “ Assemblies
“ + Manpower Cost
Ø Assembly
Cost = Cost of “ Sub Assemblies “ + Manpower Cost
Ø Sub
Assembly Cost = Cost of
“ Components “ + Manpower Cost
Ø Component
Cost = Cost of “ Semis
“ + Manpower Cost
Ø Semis
Cost = Cost of “ Minerals “ + Manpower Cost
Ø Minerals
Cost =
Cost of “ Beneficiation “ + Manpower Cost
Ø Beneficiation
Cost = FREE digging out from Earth + Manpower Cost
Every product that we see around us has its origin in
Earth
At every stage , from digging out the minerals from the
Earth ( which Mother Earth provides for FREE ) , to assembling the final product,
we need to employ people and pay them
salaries / wages , which is “ Manpower Cost “ [ This also applies to generation
of electric power – a crucial input ]
Hence, fundamentally
, every cost addition at every stage of manufacture, is MANPOWER COST !
So , the industry which manages to keep its Manpower
Cost low ( as compared to competitors ), manages to sell its products cheaper
and corner a large market share within a country
This also holds true at international level
A country which manages to keep its Manpower Costs low ,
manages to out-price other countries and can export more
Now , here is some good news as far as lowering the manpower costs is
concerned :
A fledgling
concept, flexi-staffing may soon take giant strides
·
The Hindu Business Line
·
29
Nov 2019
Extract :
Large companies are cutting down wage costs while startups want to hire
people only for a short period.
Now, there is a solution for both.
Flexi, or temporary staffing, is fast
catching up in India with retail, logistics, FMCG and IT start-ups taking the
lead.
The government’s new labour reforms are likely to give a
major boost to this concept which is still at a nascent stage in India,
compared to matured markets like the US.
Recruitment body Indian Staffing Federation (
ISF ) said :
Ø Flexi-staffing grew at 16.3 per cent to reach 3.3 million
in 2018, out of the total 463.4 million total workforce.
Ø This industry is expected to grow at 22.7 per cent to reach
6.1 million workforce by 2021
Ø A flexi-workforce is the solution for being more
competitive in the market, without investing a lot.
Simplifying and enabling labour laws in
favour of contract employment ( like abolishing The Contract Labour (Regulation
& Abolition) Act, 1970 ) will increase adoption of flexi-staffing by
companies, and more formalisation will take place.
In a country, where an estimated 83 per cent
of the workforce is informal, labour reforms will have a
profound impact on flexi-staffing.
India is today the fifth largest staffing
market globally. Due to policy reforms, over 11 million jobs shall get formalized
in 2018-21.
=======================================================
Dear Shri
Santosh Gangwarji
Congratulations for initiating the long overdue labour
reforms
But , in order to make India, a LOW COST ECONOMY , we need to go beyond labour
reforms
I urge you to consider my following proposal :
National
Jobs Policy : Treasure Hunt [ 15 Dec 2017 ]
===============================================================================
30 Nov 2019
hcp@RecuitGuru.com
Edit / 03 Dec 2019
------------
Thanks Dr HarshVardhanji ,
for your following acknowledgement to my above email :
" Noted your suggestions "
Dr. Harsh Vardhan <dr.harshvardhan@gov.in>
Sent : Mon 02-Dec-19 4:44 PM
To : hcp@recruitguru.com