Folly of hiring technical contract staff

Folly of hiring technical contract staff: Their poor salaries trigger workplace discontent. Besides, industry as a whole needs well-paid workers to sell its wares...

My VIEW:

Develop in-house skills

A B Sivakumar’s piece “Folly of hiring technical contract staff” (Business Line, November 2)  brings into focus a really grey area in Human Resources Management in government, public and private sectors in India. There is real confusion at the highest level about regular employment, ‘outsourcing of work’ and contract work assignments. To understand the implications, one may have to travel a little back in time.

While contract labour may be the continuation of ‘bonded labour’ practiced in farms, factories and mines in not so distant past, large scale outsourcing of work was an antidote against militant trade unionism which fought mechanization and introduction of Information Technology(IT), circa 1970’s and 1980’s. Policy makers, instead of taking the long and tough route of counseling trade union leadership and taking the workforce into confidence by assuring that IT is not about job elimination, but about improving efficiency by skill development, took the short-cut by encouraging ‘outsourcing’ of IT-enabled work to new generation companies which had a modern outlook to luring, hiring and firing.

Just a count of heads working in financial sector and its IT-support system will give an idea of the number of men-at-work in that sector and the huge waste of resources attributable to the reluctance of organizations to develop in-house skills. The social cost of sagging morale of workers in the organized sector and creation of an inefficient and socially insecure workforce in the unorganized sector is a subject for further study by policy makers and research scholars.

M G Warrier, Mumbai

Excerpts from the article:

"Having a big pool of technically qualified manpower on contract basis, is actually a big drag on the managements. The so-called cost cutting exercise, is actually a very costly one.

For instance, no one cares about quality time spent on training such manpower on a continued basis. The cost of such time of supervisors and managers is disproportional to the apparent cost advantage of hiring the labour temporarily.

Apart from this, the lack of socialisation skills of such manpower leads to problems. Inter-personal conflicts with regular labour, due to jealousy and ego issues, actually gives enough headaches to the supervisors and managers who are normally charged with the responsibility of solving such conflicts — one can easily imagine the waste of time here.

The HR executives also do not have much of a choice — regular visits to the diploma polytechnics and to the engineering colleges to keep the pipeline going, is a huge task, resulting in their taking the blame from line managers in case of any shortfall.

Economic impact

There are disastrous effects on the local economy, as there is always less spending on even basic necessities. One can imagine the cumulative effects when we assess such losses on a consolidated basis from several quarters. India is still a developing country, and regular manpower in industrial establishments is a big pre-requisite for stability in the economy and, to the concept of a welfare state.

The IT and the banking industry, for example, are excellent examples, where well-settled manpower spends large sums of money on various necessities and luxuries. If such spending is cut, the net result is not at all conducive to economic growth.

There is an urgent imperative to stop this growing menace of contractual technical manpower. The sooner managers realise the larger implications of their short-sighted approach, the better, not only for their own sake, but also for society at large."