NITI Aayog-supported study highlights rural-urban labour gap, places daily wages at Rs 162, Rs 554, respectively
Srinagar, Oct 26 : Jammu and Kashmir witnessed a sharp decline in its Shadow Wage Rate Factor (SWRF) for unskilled workers during 2023–24, with the overall figure falling to 0.47 from 1.00 in the previous financial year, according to a study supported by NITI Aayog.
The findings, published in the report Reassessment of National Parameters for Appraisal of Public Investment Programmes/Projects in India, reveal significant differences between rural and urban labour markets in the Union Territory.
As per the study, accessed by the news agency—Kashmir News Observer (KNO), the SWRF in rural Jammu and Kashmir was estimated at 0.36, considerably lower than the urban figure of 0.96.
The report places average daily earnings of unskilled workers at Rs 162 in rural areas and Rs 554 in urban areas. It also estimates that rural areas account for 81.01 per cent of the working population, compared to 18.99 per cent in urban areas.
The assessment further highlights variations in wages and economic labour costs between male and female workers.
For male unskilled labourers, the study records average daily wages of Rs 162 in rural areas and Rs 564 in urban areas. Their respective shadow wage factors stand at 0.36 and 0.96, bringing the combined figure to 0.47.
In comparison, female workers have been assigned average daily wages of Rs 343 in rural areas and Rs 498 in urban areas. Their corresponding factors are estimated at 0.78 and 0.96, with an overall SWRF of 0.81.
Historical figures presented in the study indicate considerable fluctuations in Jammu and Kashmir’s labour-related economic parameters over the past five financial years.
The overall SWRF remained at 0.97 during both 2019–20 and 2020–21 before declining to 0.85 in 2021–22. It subsequently reached 1.00 in 2022–23 but dropped substantially to 0.47 in 2023–24.
A similar trend was observed in rural areas, where the factor stood at 1.00 in 2019–20, slipped to 0.96 in 2020–21 and 0.81 in 2021–22, and returned to 1.00 in 2022–23 before falling to 0.36.
The urban factor, meanwhile, was recorded at 0.87 in 2019–20 and remained at 1.00 for the next three financial years before marginally declining to 0.96 in 2023–24.
The shadow wage rate factor is an economic assessment tool used to estimate the opportunity cost of employing labour in public investment projects in relation to the applicable minimum wage. It does not represent the actual wages paid to workers.
The NITI Aayog-supported exercise seeks to improve the evaluation of government-funded projects by examining the economic value of resources, including labour, rather than relying solely on prevailing market prices.
By assessing differences across regions, gender categories and states and Union Territories, the study aims to provide policymakers with parameters for evaluating project viability, estimating economic costs and improving public investment decisions.
However, the rural wage estimates presented in the overall and gender-specific tables differ, making verification of the original figures necessary before drawing conclusions about wage disparities.
The findings underline the substantial variation in estimated labour costs between rural and urban Jammu and Kashmir and their relevance in the economic appraisal of public development projects—(KNO)
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