Worlds Apart in India: Analysis of Contractualization of Labor and Evidence from Labor Market Discrimination

Abstract This study attempts to decipher the working condition of contract workers with subsequent inferences from wage-based discrimination in formal mining units to understand discriminatory practices and informalization of employment. The methodology uses both theoretical and empirical methods. The empirical analysis follows a descriptive approach with wage decomposition analysis to understand the ongoing phenomenon. The study is primarily based on field data, but we have also solicited secondary data from ASI, NSSO, etc. The field survey tries to find the extent of wage discrimination based on the responses from 300 respondents of state copper mining units located in Madhya Pradesh and Rajasthan. The findings suggest that the socioeconomic conditions do play a massive role in discriminatory behavior in the workplace. The analysis indicates economic discrimination or inequity is high among various social groups (caste) with reference to education, work experience, and skill levels. We found that there is extensive use of contractual labor in public sector units. And informalization of labor causes massive devaluation in working conditions, as wage-based discrimination is found to be stark for contractual workers further aggravating the situation.