Coping with Urban Poverty

Workers engaged in the urban informal sector form the bulk of the urban poor. Workers in this sector get low wages or if they are self-employed, their income is meagre. This implies that their living conditions are low and, if employed, their wages are less than the stipulated minimum wages. There are hardly any regulations on their working conditions and social security is virtually non-existent. A large section of this population consists of low skilled rural migrants or migrants from smaller towns. Hence, for these people, right from the time of their entry to the city they become a part of the informal sector as they have neither the skills nor the opportunities to enter better paid and more secure formal sector jobs. They thus move from one level of poverty, at their place of origin, to another level of poverty, at their destination. At the same time there are a growing section of workers in the formal sector who have lost their jobs and are compelled to work in the informal sector. For these people and their families this change means a reduction in their standard of living and insecure, unregulated employment. This paper is an attempt to understand the problems of this section of the workforce. It tries to understand the process of adaptation of formal sector workers to the informal sector.

The focus of this study is on the families of former workers in textile mills who reside in central Mumbai, which was once the centre of the textile industry. The textile industry was established in this area in the 1850s and it flourished for over a century. By the early 1990s the number of workers in this industry had shrunk to one-fifth of their number in the late 1970s and early 1980s. A large number of these workers stay in one-room tenements known as ‘chawls’, in and around the textile mills in central Mumbai. These areas are, Lal Bagh, Parel, Worli, Sewri, Saat Rasta and Byculla. Many of them have moved to other places after losing their jobs in the mills. Some of them have stayed on even though they no longer work in textile mills.

In order to gain an understanding of the living conditions and the adaptive practices of these workers, we have collected information from 100 of these families. We did not use a questionnaire to elicit information but relied on informal interviews and discussions with the worker and his family members. We have taken care to ensure that a cross section of workers living in the different areas was covered. We were thus able to assess the general condition of this section of the urban population. Though both authors were familiar with the area, when we began our work we found that the exercise would not be as smooth as we had envisioned. Surprisingly, the first problem we faced was of identifying the ex-mill workers. We found that a large number of them had left the area to settle in other places, mainly in the distant suburbs or in the towns of Thane district which neighbours Mumbai. Over the past several years land prices in the city have skyrocketed. These workers were offered fairly lucrative prices by builders and businessmen for vacating their homes. Since many of them had lost their jobs in the mills, they preferred to take the money and settle elsewhere where work was available. While collecting data we came across a number of chawls which had earlier housed mill workers. We could barely find a single worker there as they had moved out.

We came across cases where after identifying former mill workers, but when we approached them they evaded our questions by denying that they had ever worked in a mill. Initially we found this rather strange. Why should a person want to hide the fact that he had once been a mill worker? We found that in some cases the person felt humiliated at being removed from the mill and hence denied that he had worked there. In other cases the person felt that by admitting that he was a retrenched worker, his chances of future employment might be jeopardised. We hence had to be more tactful in our approach. All the same, we did manage to cover groups of ex-mill workers in different parts of central Mumbai and we could interview them at length.

We tried to collect information on the various aspects of the lives of the workers through interviews. These include, condition of the family when the worker was employed in the mill, how did the family survive after the main earner lost his job, what were the alternative work available, did this affect the education of their children, what was the nature of intergenerational occupation mobility, among other issues. In the following section these issues will be discussed, but before doing that it is necessary to discuss the position of the textile industry and its workers in the development of the city. The total employment situation in the city, its emerging trends and the social implications are discussed in the next section.

I
Employment Scenario in Mumbai

Formal employment in the metropolis has hardly grown during the above mentioned three decades. In the decade 1971-1981 it grew by only 1.4 per cent and during 1981-1993 it declined by 0.7 per cent (CRD 1995: 36). Thus during the period 1971-1993 formal employment grew by only 0.2 per cent. Another important trend during this period is that employment share in the manufacturing sector, which includes the large and small manufacturing units, fell from 47.3 per cent in 1983 to 34.7 per cent in 1993. This fall has been computed in the CRD Publication edited above computed at 8.9 per cent per annum. At the same time growth of unorganised sector employment has been high as seen by the changes in proportion of employment in the two sectors between 1961 and 1991. Another trend observed is that while the share of employment in the manufacturing sector declined, there was increase in the employment share of the services and finance sectors. The services sector share in 1983 was 19.6 per cent, which increased to 25 per cent in 1993, while the finance sector’s share was 7.6 per cent in the 1983 and it rose to 11.5 per cent in 1993.

The rapid increase in the growth of the unorganised sector indicates that employment opportunities in the city have increased. At the same time we have to consider the types of employment available. There are mainly two types of employment available in the city’s unorganised sector. These are, casual or contract labour and, self-employment. For the overwhelming majority of those engaged in this sector, both types of employment denote low and irregular income, lack of social security, little regulation in work and, absence of legal protection. All casual and contract labour find employment under these circumstances, as do workers in small-scale industries. For the self-employed, the main source of income include hawking and street vending, providing services and, home-based work. Most of the laws relating to regulation of employment and provision of social security do not apply to this sector. These laws are usually enforced in places where the Factories Act or the Shops and Establishments Act are in operation. According to the Factories Act, only those units employing 10 or more workers and using power in manufacture or those units employing 20 or more workers without using power are regarded as factories. Similarly, the Shops and Establishments Act can be enforced in units where five or more people are employed. The Minimum Wages Act is applicable to selected industries. The minimum daily wage is notified, usually once in three years, by the state government and the employers are expected to comply by these. Further, the wages stipulated are meant for an eight-hour working day. However it can often be found that workers are engaged for longer periods at wages lower than the stipulated minimum wage. Hence, workers in the unorganised sector usually work for long hours at low wages. They do not have security in employment nor any guarantee of regular work. Other forms of social security such as health, housing, retirement benefits are also denied to them. This sector is therefore also known as the unprotected sector.

Textile Industry

There were around 2,50,000 textile mill workers in central Mumbai area till 1980. After the 18 month long strike, which began in January 1982, the figure declined to 1,23,000. Over one hundred thousand textile workers lost their jobs during this period. After this the number of textile workers continued to decline and by the middle of 1990s there were only around 80,000 and their jobs too are at stake [LHK Report: 2].

The textile strike of 1982-83 undoubtedly had the worst effect on the workers in this industry [Bakshi 1984]. This strike is recorded as the longest strike in the country comprising the largest number of workers. Unfortunately, besides breaking records, the strike achieved nothing else for the textile workers. The mill owners refused to concede to the demands of the workers. The state government too came out heavily in favour of the employers, which in fact helped the employers maintain their rigid stand. During the period of the strike, the chief minister of the state, Babasaheb Bhonsale, was replaced by Vasantdada Patil, a formidable political leader who had the backing to the state’s powerful sugar cooperative lobby. It is significant that Patil was once the leader of the INTUC led union, Rashtriya Mill Mazdur Sangh (RMMS), the recognised union in the textile industry. This union was not in favour of the strike and it is possible that the fact that he was once a leader of textile workers was a factor for Patil getting the post. He would be more effective in breaking the strike.

The textile workers’ strike continued for 18 months. In the beginning, judging from the fact that the entire labour force in the industry joined the strike, the workers had hoped for a speedy decision in their favour. Gradually, as the days passed, they realised that it would be a long drawn struggle. Some new factors intervened that altered the course of events. One of these was caused by the trade unions and the other related to the changes in the production process.

The textile industry in Mumbai had been the scene of trade union rivalry over several decades. The two major trade unions locked in battle were the RMMS which was the recognised trade union of textile workers under the provisions of the Bombay Industrial Relations Act (BIR Act). The other union was the Mumbai Girni Kamgar Union (MGKU) led by the communists (mainly CPI). There were other trade unions too but they were not significant in strength. The RMMS is a moderate union that stresses on negotiations and has a reputation of never calling or supporting a strike. The MGKU, on the other hand, was a radical union that had led a number of strikes of the textile workers. These included strikes for improving the working conditions, for regularising the casual labour (known as ‘badli’ workers) that formed one-third of the workforce and for increasing the share of bonus for workers. Though the RMMS had invariably opposed these strikes, its appeal drew little response from the workers. Strikes called by the MGKU were nearly always total.

Despite these demonstrations of solidarity with the MGKU, the RMMS remained the sole recognised union of the textile workers due to the peculiarities of the Bombay Industrial Relations Act. This act, which is applicable only to the textile industry, provides for recognition of the majority union on the basis of its membership and not through voting by secret ballot. Moreover, de-recognition of a recognised union is a long and cumbersome process which includes physical verification of membership of each member by officials of the labour department of the state government. The RMMS is therefore able to retain its status even till the present.

When Datta Samant, a very popular independent trade union leader in the city, started a union of textile workers called Maharashtra Girni Kamgar Union, he got a positive response from the workers. Samant had a reputation of militancy which had forced employers to agree to large wage increases. Hence textile workers flocked to his union when he started his MGKU. The union was formed barely a year before the strike took place. The workers, especially the younger ones, had different expectations from his union which became evident after the strike began.

The two main demands on which Samant based the strike were, increase of Rs 500 as wages and, regularising all badli workers. The millowners’ association refused to accept either demands as they claimed that they were negotiating with the RMMS over the issue of wage increase. After the strike started the focus shifted to the demand for removal of the RMMS as the representative union. The younger workers were fed up of what they felt was the corruption within the RMMS. This issue led to a deadlock in the negotiations. While the workers were adamant on their demand for removal of the RMMS, the state government was equally adamant that it should stay. Hence, even though at one stage the mediation of the central government had made the mill owners’ association agree to a substantial wage increase, the workers refused to abide by any agreement as long as the RMMS remained as their representative. This in fact led to the long drawn strike as the employers and the government refused to negotiate on the issue of recognition of the representative union.

The other reason for prolonging the strike was that though the entire industry was shut for such a long time, the markets did not face any shortage of cloth. This was mainly because the mill owners had shifted production to the power loom industry. The textile mills outsourced their production to the traditional power loom centres in the state such as Bhiwandi, Ichalkaranji, Solapur, Jalgaon and Madanpura. These centres were now producing cloth under the brand names of the mills. The power looms were provided working capital and raw material by the mill owners. In fact this period saw a boom in the power loom industry. New power looms were set up and employment increased. Thus we find that while one section of workers were without work due to the strike, another section found more employment opportunities. Power loom workers are a part of the unorganised sector and their wages are much lower than that of textile mill workers and they work for 10 to 12 hours a day to earn these. Cloth produced in the power looms is cheaper than mill made cloth hence the mill owners too benefited by this arrangement. The mill owners therefore did not face losses though their mills did. This also provided them the staying power in this battle. Conditions of the workers on the other hand deteriorated steadily. They lost their only source of income and they could not find suitable alternative work. It was impossible for the city to provide alternative employment to 2,50,000 workers. They used all means to stay alive. Some committed suicide due to frustration, as they were unable to provide for their families. We have recorded the plight of the workers through our investigations.

The strike came to an end after 18 months. During this period workers and their families faced insurmountable problems. They had subsisted on low paid jobs in the unorganised sector, their wives worked in menial jobs at the homes of the affluent or did other petty jobs and many of them withdrew their children from schools so that they could join the labour market. Some workers returned to their villages in the Konkan region to work as cultivators or agricultural labour.

The situation did not change after the strike fizzled out. While conducting the study we found that the strike was a major event for the workers. It marked a rapid decline of the economic conditions of the mills workers. This was the beginning of the phase when these workers joined the unorganised sector and became a part of the urban poor. The workforce was reduced by over 1,00,000 and 10 textile mills closed down as their owners claimed that accumulated losses during this period had ruined them. The mills which reopened decided to go in for massive rationalisation, which actually meant reduction in the workforce. As a result the labour force fell further and it has now been reduced to less than 80,000. Most workers were unable to return to their jobs and those that did find employment found that conditions had changed. They were asked to join afresh as new recruits. This meant that they lost their seniority and continuity of service which meant that their post retirement benefits would reduce considerably. Some of the others were taken back as casual workers with no security in employment.

Ironically, we also found that these workers and their families are able to bear with their present economic condition because of the strike. The hardships they faced during the strike helped them get used to their present lower standards of living. In this way the strike prepared them to adjust to the insecurity they faced after they lost their jobs. In the following sections we shall examine the condition of the workers just before the strike which will be followed by their conditions during the strike. In the subsequent section we shall examine their conditions at the time the study was conducted (1999). The data presented in these sections is based on the survey conducted among 100 families of textile workers residing in the area.

II
Economic Conditions before the Strike

The data we collected from the 100 ex-mill workers give an idea of the income levels of textile workers in the early 1980s. Their income varied between Rs 1,000 and Rs 2,500 per month depending on the years of service and their position in the work hierarchy (see Table 1). These figures represented the average ‘take-home’ pay of the workers after deductions were made. A large section of the workers (44) earned between Rs 1,000 and Rs 1,500 a month and another section of them (40) earned between Rs 1,501 and Rs 2,000 a month. Hence the income of the majority of the workers ranged between Rs 1,000 and Rs 2,000 a month. Eleven of the workers covered earned between Rs 2,001 and Rs 2,500 a month while five earned above Rs 2,500 a month. As mentioned earlier, wages of textile mill workers were not very high, but they were sufficient to enable the worker and his family a decent living and some savings. They were able to educate their children which would provide better life chances to them and they could meet the expenses due to marriages and deaths in the family through loans from their employer or from other sources. Workers could save money to buy jewellery and land in their villages.

When workers recollected their living conditions before the strike we got the impression that life then was very comfortable with hardly any financial problems. This may not be totally correct, but we must keep in mind that they tended to compare the past with their existing conditions of existence. Their conditions at the time of the study (1999), as we shall see in the following sections, were worse than before and hence they viewed their past with nostalgia. This may be true to a large extent but the past (pre-strike period) was not free of problems. Textile workers had to agitate frequently for working conditions. This section of the city’s working class was known for its militant actions as mentioned in the earlier section.

Textile workers and their families had to face severe hardship during the long drawn strike. All workers we interviewed had to seek alternative employment during this period. The jobs they got were poorly paid and their income fell between half to a quarter of what used to earn. Of the 100 respondents covered, 63 earned less than a third of their wages while the rest earned around half the wages they got as textile workers. There were 72 workers who had school going children, of these 25 were forced to discontinue their education. A striking fact that we found while probing into this aspect is that there was no evidence of girls being withdrawn first from school. In all cases where the family had discontinued their children’s education, they had done so for all their children and had not withdrawn first of the girl child followed by the boys. In 35 of the workers’ families covered wives or daughters were forced to work as domestic servants or in low paid home-based work to increase the meagre family income. Thirty-two of the families substituted their earnings by pawning their jewellery and none of them could get recover these from the moneylenders. More than half the workers covered (54) had returned to their villages at one point of time to seek work there or to live off their landholdings. All of them returned, as what they earned was not sufficient to make ends meet. These are the general statistics of how workers and their families existed during the strike. These give aggregates but they do not show the actual struggle for existence. Some of the cases we are stating below will illustrate these problems.

Kapre stays in a chawl at Bhoiwada. At the time of the strike he earned Rs 2,500 a month and considered himself well off. He had five sons who were studying. His life started changing after the strike. As his savings resources dwindled he had to look for other means of survival. He purchased a few goats which he sold to a mutton shop at a modest profit. He then started rearing goats on a small scale to make ends meet. His sons had to leave school, as he could not afford their expenses. To supplement the family income his eldest son worked in a small restaurant where he earned Rs 500 a month. All the time Kapre hoped that the strike would end soon so that he could get his job back and his sons could resume their studies.

When the strike finally ended, Kapre found that his job was terminated. He did not get any compensation or any termination benefits. One son died due to illness and two of them left after getting jobs elsewhere. The other two sons still live with him and they have no permanent work. They have taken to drinking. Kapre still rears goats for a living.

Dalekar, also from Bhoiwada, earned Rs 3,000 a month. During the strike he worked as a watchman in a housing complex and was paid Rs 400 a month for working 12 hours everyday. He has three sons and the eldest had sat for his 12th standard examination. The other two sons had to discontinue their studies. He too lost his job after the mill he had worked in reopened. Dalekar stills works as a security guard though he is now paid Rs 1,200 a month. His eldest son is a casual labourer in the municipality and his other sons are unemployed. They have not studied beyond middle school.

G Nandlal stays in Kamathipura. He has two sons and two daughters. He used to earn Rs 3,000 a month and he lived comfortably. A couple of months after the strike began things changed drastically. He had to discontinue his children’s education. His elder son was in the 9th standard and the younger was in the 7th. He tried working as a coolie and later as a watchman but he found these too strenuous for him. His elder son found work in a screen printing shop where he earned Rs 400 a month. His younger son joined the shop later at a lower wage. After the strike ended, Nandlal got his job back but he could not hold on to it. His services, along with those of several of his co-workers, were terminated as the mill wanted to downsize its labour force. He was paid some compensation but it did not last for long. His health had deteriorated and a major part of the compensation was spent on his medical treatment. He was unable to work after that and his sons’ earnings now support him. He got his daughters married during the brief period that he regained his job.

Narasimha earned Rs 2,500 a month before the strike. He had one son and two daughters. During the strike he worked as a labourer in a small factory earning Rs 500 a month. His wife took up beedi rolling and later she worked as a labourer in an industrial estate. The family income was reduced to around Rs 800 and he had to pull his daughters out of school. His son was only three then and was in the pre-school stage. During this time his son fell ill and he could not provide medical help to the child. He subsequently died and Narasimha suffered a mental breakdown.

Nempthabad stays in Kamathipura. He was working as a supervisor in a mill prior to the strike and earned around Rs 3,000 a month. During the strike he started working as a head-loader (coolie) to maintain his family. His monthly income dropped to Rs 600 a month. He had four daughters, two of whom were married at that time, and a son. He had to take care of his two unmarried daughters and his son. With such a drastic reduction in his earnings he could not afford to educate his children. He still works as a head-loader and earns Rs 1,200 a month. He lost his job after the strike.

We found that families that had lower earnings were able to cope better in the changed situation. These were mainly workers whose earnings were around Rs 1,200 a month. More, who stays in Parel village, was one of them. He and his family survived by mortgaging his wife’s jewellery and with some monetary help from his mother-in-law. He worked as a casual labourer whenever he got the opportunity. He had a small piece of land in his village and he could get some food grains from there. The family lived on dry chapattis and chillies. However he struggled to keep his three daughters and one son in school. He could get his eldest daughter married during this time. He rejoined his mill after the strike but he had to retire after two years due to ill health. His two daughters and his son now work and they maintain the family.

Warke from Lal Bagh earned Rs 1,200 a month before the strike. During the strike he worked as a coolie and earned between Rs 6 and Rs 10 daily. His wife worked as a domestic servant and his eldest son supplemented the family income by delivering newspapers. Yet he did not stop his children’s education. He joined the mill after the strike but as a fresh recruit.

Kargutkar, who lived in Bhoiwada, earned Rs 1,400 a month before the strike. He has three sons and a daughter. As he was unable to find any gainful employment in Mumbai during the strike he went to his village and worked as an agricultural labourer. His wife remained in Mumbai and worked as a domestic servant. Both struggled hard in order to keep their children in school. He could get back his job in the mill four years after the strike but as a new recruit. His daughter studied till Higher Secondary and he got her married. Two of his sons are graduates and have white-collar jobs. The youngest son is still studying.

Sonawane stays in BIT chawls at Byculla. He was an electrician in a mill and earned Rs 1,800 a month. He started work as a self-employed electrician during the strike and earned Rs 1,000 a month. He has two sons and three daughters and his family struggled hard to keep them in school. Two of his daughters are graduates while one son is a mechanic in a large factory. Sonawane is still working as an electrician as he could not get his job back after the strike.

Desai stays in a dilapidated building in Parel. He earned Rs 1,500 a month as a mill worker. He has three daughters, two of whom were in school at the time of the strike. Desai started work in a power loom in Madanpura where he earned Rs 15 a day. He had to work for twelve hours a day to earn a meagre income. Later, when his employer started increasing his workload, he left the employer and started work in a power loom in Badlapur, Thane district. He got the same wages but the work was less strenuous. However he had to commute daily for four hours. This put a lot of strain on his health so he returned to his village with his family. He worked there as an agricultural labourer along with his wife. However he did not discontinue his children’s education. He now works in the same mill as a casual worker.

Parab stays at Kalachowki with his wife and two children, a son and a daughter. He left for his village when the strike began and he stayed there for four months. He returned to Mumbai as he could not get regular work in his village and he was hopeful of a solution to the strike. He could not get work for six months and his family survived by mortgaging his wife’s jewellery and dole from the trade union. Later he took to street vending and sold vegetables on the pavements. He earned Rs 30 a day but, despite the hardships, he did not stop his children’s education. He is still a hawker, as he could not get his job back after the strike.

The above cases are some instances of the workers struggle for existence during the strike. A significant feature is that those workers who earned higher wages before the strike showed a tendency of withdrawing their children from school after their income fell drastically. All the five workers covered in the study that earned between Rs 2,500 and Rs 3,000 and six of the 11 workers who earned between Rs 2,001 and Rs 2,500 had discontinued their children’s education. On the other hand, we covered 24 workers who earned between Rs 1,000 and Rs 1,500 and had school going children and all of them managed to keep their children in school. The drop-out rate of school going children was high among families of workers earning over Rs 2,000 a month.

During the time of the strike earnings of all workers fell drastically as they found employment in the unorganised sector. The average earnings were around Rs 600 a month. This meant a reduction of 40 per cent or 50 per cent for those earning Rs 1,200 or less. Whereas, for those earning Rs 2,000 or more the fall in income was very high. It was possible for the former to adjust to the new situation but for the latter this was a sudden plunge into poverty. They were not able to cope with their changed fortunes. Their children were withdrawn from school either because they could not afford to bear the expenses or because they were expected to work in order to supplement the family earnings. Unfortunately, this implied that the future of these children would be equally bleak. We found that the economic conditions of these families have remained unchanged even after their children grew older as they could only get low paid work in the unorganised sector. In this sense, the workers earning better wages became the more vulnerable section after the strike when their income fell. This can be seen from their present economic conditions discussed in the next section.

III
Present Conditions

The condition of the 72 workers who could not regain their jobs was even worse. Five of them were taken back after the strike but they had to leave after a few years. Three were eased out because their mills wanted to downsize and two had left as their health had deteriorated during the strike and they could not cope up with the work. Sixteen of the workers were unemployed at the time this study was undertaken. The income of the rest (56) had decreased. Twenty-five of them were working in small-scale industries, power looms, or in part-time jobs. Twenty of them had taken to street vending, six to other types of self-employment while five were coolies.

A comparison of their present levels of income with those before the strike is shown in Table 1. There are 32 who earned less than Rs 999. Of these 16 were unemployed and had no income. Before the strike none of the 100 workers covered earned less than Rs 1,000. Forty-two of the workers covered earned between Rs 1,000 and Rs 1,500 a month and the remaining 27 earned more than Rs 1,500 a month. Of these 18 earned between Rs 1,501 and Rs 2,000, five earned between Rs 2,001 and Rs 2,500 while only three workers earned more than Rs 2,500 a month. A majority of the workers (56 of them) earned more than Rs 1,500 a month whereas at present only 26 of them were in that income bracket. We thus find that after a period of 17 years (1982-1999) the incomes of the workers have fallen. In terms of real income, the fall is much greater.

In the previous section we have examined the incomes of the workers. Let us now examine their household incomes at present (1999). These were slightly higher because most households had more than one worker. At the same time the number of dependents (non-earners was also high (see Table 3)) which off-set the gains of higher income as the per capita income was reduced. Sixty-one households had between three to five dependents.

The range of household income is given in Table 4. There are 62 households which had incomes of over Rs 2,000. This is not very high considering that 58 of the households had more than one earner (see Table 4). Moreover, we found that in several cases where a family member (usually the son) got a better-paid job, he separated from the household after marriage. This was noticed in eight cases. These sons were employed in large factories or in offices and earned over Rs 6,000 each. They invariably sought other accommodation after they were married. Hence only those children who had no job or were engaged in poorly paid jobs remained with their parents. Thus a number of low paid workers, including the ex-mill worker, pool their earnings to collectively meet the needs of the family.