Comparative

Analysis of Labour
Markets: India and
Israel
BY MEDINI J S
 INTRODUCTION:
Labour laws are a body of law that deals with employment, remuneration, work conditions, and other related
areas.
The law oversees the rights of employers and employees along with their duties and contractual agreements,
including work hours, health and safety, and other benefits.

Israeli society is split into different groups. On one side, there is the general Jewish population, which enjoys
low poverty rates and high employment. On the other side, there are Arab citizens, who make up about 20% of
the population, and ultra-Orthodox Jews, known as Haredim, who account for about 8%

In the initial years of development planning, unemployment was not expected to emerge as a significant
problem. It was assumed that a reasonable growth rate and labour-intensive sectors would prevent any
increase in unemployment, and this expectation continued from one Five Year Plan to another during the 1950s
and 1960s.
 CHALLENGES
Inequality Type of Employment Immigration
The Israeli labor market Vulnerable employment among Immigrants from the former USSR
shows a lot of inequality. women is 7.3%, and among men is have higher participation and
This is evident in both wage 9.3% in Israel for 2022. The employment rates than other Jews
rates and employment vulnerable employment rate is (84% and 79%, respectively), and
lower for men and women in Israel many have been able to transition
participation. Wage gaps
comparatively but still a large from low-skilled to high-skilled
increased significantly
number. occupations.
during the high inflation
India is plagued with excessive India has immigrants from the
years from 1975 to 1985,
informal employment and they are nearest countries coming in and
but stabilized when being misused taking up most of the jobs leaving the
economic reforms were Indians to the informal sector.
introduced in the late 1980s.
India has inequality in wealth
and gender and informal
employment
AGRICULTURE

In India, even though the share of agriculture is decreasing in rural areas, it still
provides many jobs. According to reports, the number of rural male workers in
agriculture dropped from 81% in 1977-78 to 59% in 2011-12, while for rural females
it went from 88% to 75%. In urban India, the "trade, hotel, and restaurant" sector
had the highest employment rate among male workers, at about 26%. In Israel,
there are limits on how many work permits can be issued for construction and
agriculture jobs, but these limits aren't based on actual demand in those sectors.
When specific skills are needed, like for masonry in construction, there isn’t a way
to check if workers have those skills. Farmers often prefer to hire Thai workers,
who may work unpaid hours, which lowers their real wages below the minimum
wage.
 Israel is not self-sufficient in agriculture and is dependent on imports. Israel’s limited land and water
resources preclude agricultural self-sufficiency and affect local production costs and consumer
prices.Since the 1990s, Israel’s agriculture sector has relied almost entirely on migrant workers, as a
solution to it’s chronic shortage of working hands.
In the summer of 2023, the Israeli government decided to increase the quota from 30,000 to 40,000
migrant workers in the agricultural sector, in addition to Palestinian workers, whose number varies
according to the season and the security situation. In 2012, Israel signed a bilateral agreement with the
Thai government, deciding that agricultural workers could come to Israel only under bilateral agreements.
As to 2023, Israel employs around 30,000 Thai citizens to work in agriculture as well as about 3,000
students from developing countries who come for one-year work/study programs in agriculture.
In November 2023, due to the shortage of workers in the sector, Israel signed a new bilateral agriculture
agreement with the Sri Lanka government, and also approved the arrival of up to 5,000 migrant workers
from other countries, outside the scope of bilateral agreements. In December 2023, these workers began
arriving to Israel in small numbers, along with thousands of workers from Thailand who have returned to
work in Israel even though the war is still ongoing. Migrants and agriculture students workers in Israel
often do not receive the basic rights in terms of Israeli labor law, including minimum wage, overtime
payments, rest days, holidays, paid leave, accurate pay slips and other social benefits. In addition, they
often live in deplorable accommodations, and do not enjoy most of the safety rights provided by Israeli
legislation.
 The First Agricultural Labour Enquiry Committee 1950-55 defined Agricultural Labourer as - "Those people
who are engaged in raising crops on payment of wages"
Seasonal unemployment is a characteristic feature of Agricultural Industry and under employment of man-
power is inherent in the system of family farming. According to first A.L.E.C., adult male agricultural labourers
were employed on wages for 189 days in agricultural work and for 29 days in non-agricultural work i.e. 218 day
in all. They were self-employed for 75 days. Casual male workers found employment for only 200 days, while
attached workers were employed for 326 days in a year. Women workers employed for 134 days in a year.
Difficulties in defining agricultural labour are compounded by the fact that many small and marginal farmers
also work partly on the farms of others to supplement their income. To what extent should they (or their family
members) be considered agricultural labourers is not easy to answer.
Agricultural labour in India is being widely scattered over 5.6 lakh villages, of which half have population of
less than 500 each.
Agricultural labourers, especially in smaller villages away from towns and cities, are generally unskilled
workers carrying on agricultural operation in the centuries old traditional wages.
Agricultural labourers are not organized like industrial labourers. They are illiterate and ignorant. They live in
scattered villages. Hence they could not organize in unions.
Most agricultural workers belong to the depressed classes, which have been neglected for ages.
The number of agricultural labourers being very large and skills they possess being meager, there are
generally more than abundant supply of agricultural labourer in relation to demand for them.
 CONCLUSION

The distinct comparative advantages of Israel and India shaped their respective development paths. Israel's
advantage lay in its innovativeness, while India's strength was low labour costs. This fundamental difference
influenced how each country shaped its labour laws. In Israel, globalisation fostered the growth of an
advanced industry that prioritized research and development (R&D). This led to the establishment of numerous
local start-up companies, which became a hallmark of Israel's economic landscape during this period. The
focus on R&D allowed Israel to leverage its innovative capabilities effectively. Conversely, India experienced a
different trajectory. The globalisation process resulted in developing an advanced industrial sector that
concentrated on manufacturing and service centres. This approach capitalized on India's low labour costs,
enabling the country to attract foreign investment and create jobs in these sectors. The unique advantages of
each country significantly influenced their responses to the labour problems, leading to divergent economic
developments and social impacts.
Thank you!