The employment structure of the Indian economy has been undergoing certain
changes with globalisation. It has made competition an important component for
the development, expansion and growth of industry. In this context, low labour
cost, along with flexibility in labour use, inter alia, have become key sources of
competitive advantage for firms. Moreover, location decisions of international
investors are increasingly guided by the availability of cheap labour and the scope
for informal employment arrangements. These developments have had varied
implications for labour, employment and industrial relations. The nature of
employment is changing, with new employment created in the economy being largely
contractual, that is, in the nature of a client-supplier relationship, where employment
is offered not as an appointment but as an assignment. The present paper, therefore,
examines the implications of a more flexible labour market on the quantity and
quality of employment by taking the case of India’s manufacturing sector.