The recent proposal of the BJP – Shiv Sena government in Maharashtra to ensure 80% jobs in industries be provided to locals holding domicile certificates from the state, has raised fresh questions on the future of talent mobility in India. The state industries department is planning to introduce this clause in the MoU that the investors and employers have to sign with the state government to avail benefits and tax exemptions. It will be overseen and enforced by a special Maharashtra government cell, comprising of employee unions and the industries department. The focus of the government is not limited to investment, but also employment generation for the people of the state.
Mr. Aditya Narayan Mishra, Chief Executive of CIEL HR, a leading staffing agency in India, appeared on The Urban Debate on Mirror Now TV channel to discuss the implications of this proposal. He mentioned that it was often seen that local residents in a city may have the skill but are not interested in taking up certain job opportunities. This creates a situation where the employers have to look beyond the local residents and find people who have the skills as well as the will to take up these jobs. Therefore, there is an equal need of skill and will in people to do jobs available in society.
The need of the hour is job creation for India as a whole. Adding a domicile certificate requirement for employment not only adds to the administrative hassle of collecting additional documentation by employers and recruitment agencies, but also creates limitations in talent mobility within India. By directing companies/ industries operating in Maharashtra to comply with the 80% local workforce requirement, an additional boundary has been created which did not exist until now. This is also likely to shake investor confidence and willingness to operate in the state. Further, it is a dangerous precedent to set as other states in India may follow suit with similar restrictive policies. Subsequently, global companies from Japan, United States of America, Germany and many other developed countries are likely to think twice before they invest millions to set up or expand operations in India. They will see this as a risk and restriction on attracting skilled talent; hence, cost of doing business goes up for them. India loses a few points in its competitiveness as an economy.
Currently, in the private sector, focus during hiring is primarily on quality of talent. By creating a reservation-like system, we create silos and push employers to potentially compromise on the quality of talent they can hire. It is regressive and likely to face scrutiny similar to what is faced by the United States of America with their intention to limit the usage of the high-skill H1 B visa program.
If the intention of the state is to generate more employment, it can think of ways of encouraging companies to create jobs rather than forcing them to hire locals and enforce it. Employers have been just recovering from the mandatory aadhaar-linkages. Introducing one more administrative angle such as domicile certificate complicates matters further.
He concluded by saying “When the whole country adopted a unified tax policy, what is stopping us from being one nation, one talent pool?”