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The plantation management has to overcome many hurdles in
their effort to remain competitive in the world market.
Among these, issues pertaining to labour costs and availability
are fast coming to the forefront. Considerable changes have
taken place both in the estate sector and the macro environment
of the country that have influenced the labour supply and
demand situation of the estates. If the present trends continue,
a labour shortage situation is imminent. To reap the dividends
from productive investments in the sector, the estates must
have access to a ready and reliable work force. Hence, it
is vital that the management take timely action to improve
labour supply problems.
Since plantation crops are essentially
export oriented, individual producers have -- in the absence
of marketing initiatives-- little influence over the prices.
As a result, estate profitability is mainly determined by
the efficiency of the management in minimizing costs. Labour
costs -- given the labour intensive nature of plantation
crop production -- account for a significant portion of
total costs. Since the late eighties, labour costs have
been rising in the estate sector. If these wage increases
are to be accommodated without eroding the competitiveness
of the sector, labour productivity has to increase.
Traditionally labour has been considered
as a cost, not as a resource to be developed. Labour welfare
improvement programmes were launched mainly for humanitarian
reasons. Partly due to availability of a cheap, submissive,
captive and abundant labour force, there was little incentive
to look at expenditure on social welfare as investments
that contribute to the long-term productivity of the estates.
There is increasing qualitative evidence of links between
worker welfare and estate productivity. However, no study
to date has rigorously assessed the direction and magnitude
of these linkages.
This study hopes to fill this gap in the
literature. Using a multivariate analysis, it examines the
inter linkages between social welfare programmes and labour
performance indicators while controlling for all other contributory
factors. In particular, the study analyses the effects of:
1) crèche attendance, 2) better housing, 3) individual
latrines, 4) maternal care services, and 5) availability
of qualified medical personnel on labour outturn and labour
productivity.
The results for the most part are consistent
with the findings of earlier qualitative studies and conventional
wisdom. They show that most welfare programmes affect labour
outturn and productivity positively, and that management
can expect to improve profits through investments in welfare
programmes. One exception was the impacts of new or improved
housing on labour outturn. The study cautions that this
unexpected result could be possibly due to the nature of
the housing programme and its recent inception. It argues
that the impact from new or upgraded housing on labour performance
may also be positive as the housing programme matures.
Table of Contents
- Introduction
- Data
- Determinants of Labour Performance Indicators
- Indicators Used for the Empirical Analysis
- Results
- Conclusion and Discussion
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