With the Government of India’s renewed focus on affordable housing, the real estate sector is expected to see strong growth in the next few years. Besides contributing a significant 6-7% to India’s gross domestic product in 2017, the sector is the second-largest employer after agriculture. The Indian Economic Survey 2017-18 had projected a construction workforce of more than 50 million people. Yet, the survey showed that just over 9% was skilled labor.
A predominantly unskilled construction labour force is thus playing a key role in meeting the country’s demand for an estimated 90 million housing units by 2022. An overwhelming majority – about 95% – of the demand comes from the Economically Weaker Sections and Low Income Group segments.
Adequate housing demand and labour
Although significant measures are underway through “Housing for all by 2022” mission by the Government of India to address shelter challenges, implementation is plagued by various issues, including a shortage of skilled labour and poor workmanship. Ensuring speedy, scalable and practical models of skill development is imperative to meet the needs of 441 million people who need housing in rural and urban areas by 2022.
Low Income Group households typically follow a process of self-construction or beneficiary-led construction, where local masons are hired to build homes, with active involvement by homeowners in construction and supervision. Masons play the multifaceted role of engineer, architect, contractor and advisor to homeowners, but not all masons are fully equipped with appropriate technical knowledge and up-to-date skills. They are often informally trained in construction and engineering practices, and rely on inherited knowledge and skills (on the job learning).
Skilling new entrants and upskilling existing workers on construction fundamentals, necessary engineering practices and proper application of key construction materials are critical, given the large existing housing demand and the number of workers employed by the industry. However, employment in the industry is predominantly dependent on unskilled and semi-skilled laborers,who constitute more than 80% of the total workforce. These labourers are employed informally with poor social and job security, poor work conditions including safety, hygiene and accommodation, and without defined paths for upward mobility in their career.
To understand the sector and address challenges, organizations are looking into strengthening private initiatives and providers to make house building, repair and services more affordable and resilient. Habitat for Humanity’s Terwilliger Center for Innovation in Shelter partners with relevant stakeholders to catalyze supply and demand and facilitate market-driven solutions to address various constraints and market failures that prevent the poor from accessing quality products and services.
To develop suitable intervention programs to address the underlying challenges in the self-construction process, the Center carried out detailed research in the districts of Cuddalore, Kanchipurum and Chengalpet in Tamil Nadu, between May and September 2018. The research consisted of understanding mason-driven low-income households’ construction practices,and social norms
around housing in low-income segments and its impact on labor practices.
As part of the research, more than 90 interviews and focus group discussions were held with various stakeholders in the housing value chain, including masons, builders, contractors, engineers, architects, training providers, skill development councils, and relevant government departments, in addition to detailed literature review and analysis of policy documents. Research key findings and potential opportunities for the sector are provided below.
Key findings
Construction industry practices:
- High level of labour informality–workers are usually employed on a daily wage basis with no job tenure or social security. Salaried employment is limited to supervisors and above,who constitute less than 20% of the workforce.
- On the job learning – there are no entry barriers or minimum qualifications for construction workers, and one can become a mason, bar-bender, carpenter and similar occupations with little training. There is no defined career progression, and those who are entrepreneurial progress faster, but the vast majority of the labour are stuck in low-skilled jobs for years.
- Preference for migrant labour –in most metropolitan areas, the majority of the labor pool comprises workers who migrated from lesser developed states. They areless costlyand mostly hired through middlemen who receive commission from the workers’ wages.Such informal hiring further reinforces on the job learning as the status quo.
Construction practices in the low-income households’ segment:
- Prevalence of a strong referral practice. Households choose masons or local contractors primarilybased on referrals from family, friends and trusted contacts followed by a certain level of due diligence.
- Households are risk-averse and reluctant to try new materials or technologies and prefer conventional brick, mortar and reinforced cement concrete construction.
- Construction labour, in general,has a stigma in admitting gaps in knowledge. The workers believe they have learnt the necessary skills on job.
- On the job training is seen as the only credible mode of learning, and there is a widespread lack of interest in any formal training, up-skilling or professional certifications. However, among younger workers, certification through a process of Recognition of Prior Learning has generated interest.
- Most masons only trust materials and techniques they are familiar with and have reluctance in trying new materials or methods, even if those proved to be superior and beneficial.
- Higher importance is given to finishing activities such as plastering, façade and aesthetic aspects of construction, as only outer finishes are noticed by customers,leading to basic lapses going unnoticed.
Challenges in addressing skill gaps
Despite numerous initiatives and budget outlays for skills’ development by Government of India, uptake of skilling in construction trades has been abysmally low. The Terwilliger Center’s interactions with training providers, skill development corporations,construction companies and labour identified the main barriers to proper labour skilling:
- No demand for proper labour qualification by households and the industry. The current informal contracting system is generally accepted by the sector because it does not have to hire labour directly. Meanwhile,households in the self-construction segments hire masons and labour mainly through referrals and not based on qualifications.
- Opportunity cost of skilling.Youth entering the labour market don’t aspire to manual jobs in construction,and those who take it up do so out of poverty anda lack of other opportunities. Moreover, labour workers don’t want to lose even a day’s wage to undergo training.
- No perceived value addition from skilling among labour. As hiring happens through referrals from sub-contractors or middlemen, it doesn’t often lead to wage increase or greater job opportunities.
- Inadequacies in traditional vocational education systems.Inadequate trainers and infrastructure, the lack of industry networks, poor job placement, outdated curriculum and training practices have led to low enrollment and low aspiration for vocational training among teens and uneducated workers.
Solutions and opportunities
Moving beyond conventional methods of training, an innovative and holistic approach to skill development could open up new pathways to meet the demand for skilled labour in the construction industry. The research identified the following opportunities to build a sustainable movement that can improve the labour quality in the Indian construction sector:
- Develop alternate models of training that are imparted on-site or locally.A way forward could be through shorter trainings with concept briefing, demonstrations and hands-on experimentation through partnerships with manufacturers, industry and training providers.
- Redesign apprenticeship programs that are aspirational for youth as well as viable for the industry. The government’s National Apprenticeship Promotion Scheme is a step in this direction, but it still needs to be better structured for the construction industry to address the entrenched informal practices.
- Promote and scale up recognition of prior learning-based trade certifications. Labour unions and associations should encourage their members to get their skills tested and certified.
- Information and communication technology-enabled interventions such as marketplace models linking homeowners and skilled labour paired with user rating systems, app-based training, delivery and advisory services.
- Promotion of rural mason trainings linked to the Government’s rural housing scheme Pradhan Mantri Awas Yojana – Grameen can lead to increased adoption of certification levels and awareness among households to hire certified masons.
- Facilitate industry partnerships with vocational education and private training providers to assist in training-of-trainers courses, lesson planning, trainings and to pilot and test alternate models of on-site micro trainings, demonstration workshops and other modalities.
The development of a strong network of skilled labours who can build or repair stronger and resilient houses and reduce communities’ vulnerability to natural disasters is critical. The size of the housing deficit in India and complexity of the owner-driven construction process make a compelling case for a market systems approach to help housing markets be more responsive to low-income households’ needs.
To advance such initiatives, the Terwilliger Center for Innovation in Shelter is looking to equip masons and construction workers with technical knowledge and update their skills to build more durable, disaster-resilient housing. Organizations, professional associations and academics can apply to join the Terwilliger Center’s program by sending an expression of interest in receiving financial and technical support, benefiting from Habitat’s expertise and latest findings from on-going research and global best practices.
By Prasanna Sriraman
Specialist, Market Systems and Entrepreneurship, Terwilliger Center for Innovation in Shelter
Habitat for Humanity International
