SN Subrahmanyan, Chairman and Managing Director of Larsen & Toubro (L&T), has raised concerns over rising labour shortages in the construction industry, attributing it to welfare schemes that provide financial security without the need for relocation. His remarks came during the CII Global South Linkages Summit 2025 held in Chennai.
Labour Shortages in Construction
The construction sector, vital for national growth and development, is facing acute labour shortages. Subrahmanyan highlighted that L&T needs to employ 4 lakh workers annually, with attrition rates causing the company to mobilise up to 1.6 million labourers per year.
“Imagine now to mobilise 1.6 million people every year. We even had to create a separate HR department for this task,” he stated, underscoring the magnitude of the challenge.
He noted that many labourers are hesitant to leave their rural homes, as schemes like Jan Dhan, Garib Kalyan Yojana, and MGNREGA provide financial stability. These programs, while essential for welfare, may inadvertently reduce the incentive for workers to relocate for employment opportunities.
Reluctance to Relocate Among Engineers
The issue of labour unwilling to move is not confined to construction alone. Subrahmanyan pointed out that engineering professionals and IT sector employees also display reluctance to relocate from their cities of origin, despite the prevalence of “hustle culture” in these industries.
“The current generation of workers operates differently from the older generation. They can decline orders from senior managers without hesitation,” he said, emphasizing that companies need to adapt their HR policies to this evolving workforce mindset.
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Balancing Welfare and Workforce Mobilisation
Subrahmanyan acknowledged the positive impact of welfare schemes but stressed the importance of striking a balance between providing social security and ensuring workforce availability. He suggested that human immigration, technological transition, and sustainability are shaping the future of industries globally.
The CII Global South Linkages Summit, with the theme “Powering Ahead to a $10 Trillion Economy,” brought together key stakeholders to discuss strategies for economic growth. Subrahmanyan’s remarks highlight the ongoing challenge of labour shortages in India’s infrastructure sector, which requires both immediate and long-term solutions to sustain growth.
