Hi Friends,

Even as I launch this today ( my 80th Birthday ), I realize that there is yet so much to say and do. There is just no time to look back, no time to wonder,"Will anyone read these pages?"

With regards,
Hemen Parekh
27 June 2013

Now as I approach my 90th birthday ( 27 June 2023 ) , I invite you to visit my Digital Avatar ( www.hemenparekh.ai ) – and continue chatting with me , even when I am no more here physically

Thursday 28 November 2019

Low Manpower Cost = Low Cost Economy




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
https://i.prcdn.co/img?regionKey=%2ffK1m0CnuBftq4nCaUd5Vw%3d%3d

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 ]


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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


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