Labour, Jobs and Employment – Harmonization of labour laws, gender gap, unemployment, etc.

Narayana Murthy’s Proposition: Notion of Extended Working Hours


From UPSC perspective, the following things are important :

Prelims level: NA

Mains level: Work Productivity

narayana murthy

70 hours Work: Narayana Murthy Suggests

  • Infosys founder N.R. Narayana Murthy’s recent call for young Indians to work 70 hours per week has ignited a debate on worker productivity in India.
  • He cited Japan and Germany as examples of nations that prospered due to longer working hours post-World War II.
  • However, his views raise questions about worker productivity, its relationship with economic growth, and India’s unique context.

Worker Productivity vs. Labour Productivity

  • Conceptual Difference: Worker productivity involves mental activities, while labour productivity is associated with manual tasks.
  • Measurement: Productivity is typically measured as the output value per unit of labor cost.
  • Complexity in Services: In intellectual labor, measuring output independently is challenging; hence, worker income often proxies productivity.
  • Fallacious Assumption: Murthy’s assertion that increased working hours lead to higher productivity is contentious, as it could exploit workers without commensurate pay.

Link between Worker Productivity and Economic Growth

  • Complex Relationship: While productivity improvements impact economic growth positively, the relationship is intricate.
  • Distribution of Income: India’s economic growth hasn’t necessarily benefited all income groups; wealth disparities persist.
  • Income Inequality: Income gains have disproportionately favored the top income strata, suggesting a disconnect between productivity and income distribution.
  • Factors Influencing Wealth: Factors like hereditary wealth transfers and arbitrary compensation for the super managerial class have contributed to income disparities.

Is India’s Worker Productivity One of the Lowest?

  • Proxy Fallacy: Using income as a proxy for productivity can yield misleading conclusions.
  • Indian Workforce: Indians are among the hardest working employees globally, but they receive comparatively lower wages.
  • Contradictory Statements: Narayana Murthy’s claim about low productivity seems unsubstantiated, possibly driven by motives to push labor reforms.

What data shows?

  • In 1980, India’s Gross Domestic Product was about $200 billion, which by 2015 exceeded $2,000 billion.
  • Income distribution data from 1980 to 2015 in India:
    1. Bottom 50% income groups experienced a 90% increase in income.
    2. Top 10% income group’s share increased from 30% to 58%.
    3. Top 0.01% experienced an increase of 1699%.
    4. Top 0.001% had an increase of 2040%.

Impact of Informal Labor on Worker Productivity

  • Rise in Informal Employment: Economic reforms have witnessed a surge in informal employment.
  • Limited Formalization: Formalization efforts have mostly focused on tax compliance and not labor standards or conditions.
  • Exploitation in MSMEs: Even within the formal manufacturing sector, Micro-Small-Medium Enterprises (MSMEs) engage in wage cutting to maximize profits.
  • Outsourcing Practices: Large corporations outsource production to smaller labour-intensive units, exacerbating labor exploitation.

Comparing India with Japan and Germany

  • Inadequate Comparisons: India’s unique context, including its labor force, technological trajectory, socio-cultural dynamics, and political structures, makes direct comparisons with Japan and Germany inapt.
  • Unique Development Path: India’s sustainable development requires enhancing social investments, tapping domestic consumption potential, and focusing on human-centric development.


  • The call for extended working hours to boost worker productivity raises complex issues regarding labor exploitation, income distribution, and India’s economic context.
  • Direct comparisons with Japan and Germany overlook India’s unique challenges and opportunities.
  • A comprehensive approach that addresses these intricacies is essential to ensure sustainable and equitable development in India.

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