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‘Manufacturing sector suffers from considerable job loss post note ban’

AIMO said that those in the age group of 40 to 55 are the worst hit with 40 per cent job losses due to note ban, based on data till December 31.

Written by Arun Janardhanan | Chennai | Updated: January 17, 2017 11:57:10 am
demonetisation, note ban, rs 500 ban, rs 1000 ban, job crisis, employment crisis, job loss, manufacturing sector, indian express news, india news, business news, economy The study projects 45 per cent job loss and 40 per cent revenue dip in sectors such as small and micro industries by March 31. (Representational image)

A study assessing the impact of first 50 days of demonetisation on the manufacturing sector conducted by an organisation of manufacturers suggests considerable impact on jobs front.

The study conducted by All India Manufacturers’ Organisation (AIMO) suggests that micro and small scale sectors were affected largely in the first 50 days and similar impact is going to be reported from medium and large scale industries before March 31 as the slowdown in the market that first affected the feeding sectors has spread to medium and large sectors too.

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AIMO said that those in the age group of 40 to 55 are the worst hit with 40 per cent job losses due to note ban, based on data till December 31. It also records that 32 per cent of the people in the age group of 22 to 30 have also lost their jobs. The report says that till December 31, some 60 per cent job loss was reported in the sector along with a 47 per cent dip in revenue on part of small scale traders, shops and micro industries. Medium scale industries with a staff strength of 300 to 700 have suffered 3 per cent job losses and 7 per cent revenue loss. Large-scale industries, with 2,000 to 3,000 employees, suffered 2 per cent job losses and 3 per cent revenue dip during the same period.

The study projects 45 per cent job loss and 40 per cent revenue dip in sectors such as small and micro industries by March 31. It has also projected that the same would be 38 per cent and 29 per cent on small scale industries in the next two-and-a-half months.

Compared to the impact reported till December 31, job losses in the medium scale industries will go up from 3 per cent to 6 per cent by March 31.

Also the large scale industries that showed a little impact till December 31 will face the worse with a projection indicating an increase of job losses from 2 per cent (till December 31) to 4 per cent and the revenue loss from 3 per cent to 5 per cent by March 31. Compared to the last financial year, a more specific sector-wise analysis in the report says, the service sector comprising transporters, container handlers and equipment contractors have registered a loss of 43 per cent till December 31.

While product manufacturing, capital goods, end products and export sectors register 28 per cent revenue loss, manufacturing sector representing ancillaries to large scale industries report 35 per cent loss.

Sectors engaged in raw materials for other industries report only 21 per cent, infrastructure companies involved in projects such as roads and ports (55 per cent) and builders (58 per cent) are the worst hit up to December 31.

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