Tuesday, October 2, 2012

Retail FDI: Creation of 10 million jobs not practicable.

Creation of 10 million jobs is not practicable.
It is true that a few thousands of literate/educated youth will get job in
retail chains and get attractive salary too. Most of those jobs will be
generated at the front-end, in positions such as sales associates, cashiers,
customer services staff, security guards, in-store security personnel, IT and
systems for retail staff, customer relationship associates, loaders/ unloaders,
merchandise refilling staff, department managers, store managers and regional
and national managers. Some of the new jobs will be in warehousing and
logistics-related areas. The rest will come in manufacturing services such as
per-processing and processing. But what is the guarantee that the displaced persons
belonging to the unorganised retail sector will find employment in the
multinational retail outlets. A few corporate brokers will also get opportunity
to earn considerable amount of brokerage.Coming to reality, the creation of 10
million jobs is unachievable even in the long-run, leave alone in just three
years, as against the contention of Mr.Anand Sharma, the Union Commerce and Industry
Minister, who failed to elucidate the ways and means of creating such a large number of jobs,
say in millions, by the multinational retail giants. Various studies on the impact of global retail
giants setting up retail stores confirm that job losses have occurred
everywhere and as a result disrupted the livelihood of the people. The study by
David Neumark of the University of California and his colleagues in 2007 revealed that for every
job created by Big Box retail, 1.4 jobs are lost from smaller retail stores in
the neighbourhood. Another study by Emek Basker of Missouri University in 2005
concluded that up to 60 jobs might be lost in 5-6 analysing US
counties with an average population of 78,000 (during 1977-1998). Another study
on opening of retail shops by the global giants in Jakarta (the capital city of
Indonesia, found that 2 jobs were lost in the unorganised retail sector for
every one job created by the Big Box retail). According to the Madras Kirana
Merchants' Association: “It (FDI in retail) is an act not desirable for any
country to create a situation in which a few retail giants monopolize the major
portion of retail trade, This is particularly applicable to India where large
numbers of people (who cannot be employed elsewhere) are employed by this
trade. This move of the Government will affect the presently unemployed force
of India and also affect the presently employed force in future.
Dr.C.Murukadas, First  Post.Economy, Oct. 2, 2012

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