Let private firms hire as they want

There are ways in which states can ensure jobs for locals — without a law. Explore them

Haryana chief minister Manohar Lal Khattar has described a law passed by his government, reserving 75% of jobs paying under ₹30,000 a month in private companies based in the state for those domiciled in Haryana, as non-discriminatory. The law is before the Punjab and Haryana high court, which has been asked by the Supreme Court to decide on its merits by mid-March. There are a handful of other states with a similar law (and some more are considering it). Jobs, or the lack of them, after all, is a pressing issue, although election results, or even the focus of campaigns, seems to suggest that they are not yet a make-or-break one.

Private companies should be allowed the freedom to hire as they please. That is axiomatic. But there are ways in which governments can ensure jobs for locals — without a law. The first is to offer companies inexpensive land, or discounted power on condition that a certain proportion of jobs is reserved for locals. This may work, but it is also susceptible to corruption at either end of the equation, in both land deals that benefit politicians, and the appointment of people who are not locals. Still, it is better than mandating reservation in the private sector.

The second is to approach the problem from the supply-end. What kind of jobs are people hiring for? How can local residents be prepared/ trained for such jobs? Is there a way in which companies can be encouraged to offer apprenticeships, with the government underwriting the stipends paid? Tamil Nadu is one state that has been successful in addressing the problem from the supply-side — as evident in the big automotive and electronics manufacturing gold rush the state saw in the 1990s and 2000s respectively (although some of the companies themselves ran into problems that had nothing to do with either location or the skill levels of local workers). The only problem with the second approach is that it doesn’t lend itself easily to political messaging. But if the court throws out the Haryana law, the state may have no option but to go for it.