Indian Migrant Workers are Redefining the Housing Market
India’s migrant workers are voting with their feet: streaming onto railways and roads, taking to bikes and byways and making their way back to the Cities they deserted in the aftermath of the pandemic. It’s the biggest movement of people on the subcontinent since Independence more than seventy years ago, and it’s set to have a profound impact on the future of Subcontinent’s housing market across India, from Chennai to Mumbai and all points in between (more of which in a moment)…
Movement of workers back to the cities
A recent survey conducted by the Inferential Survey Statistics and Research Foundation (snappy name, snappy stats) reported 67% of 2,917 migrant workers from 34 Districts are determined now to make their way back to jobs in the City (www.issrf.org.in): a fact already confirmed by the volume and value of cash transfers since the lockdowns were imposed in March.
That old reliable bellwether of migrant activity: sending money home to mum and dad. In the first few weeks after COVID-19 struck cash transfers fell in value by up to 90%, but now they’re back now at 85% of pre-pandemic levels…a sure sign workers are moving in high numbers from the countryside. And since August, non-suburban passenger traffic on India’s railways has virtually doubled.
It’s impossible to overstate the importance of this trend, given migrant workers make up 20% of the subcontinent’s workforce and play a vital part in the success of a number of key sectors: especially informal market segments and MSMEs, which together make up 50% of the subcontinent’s GDP.
No surprise then that for India’s construction sector, which is particularly reliant on migrant labour, the Modi Government has been keen to roll out a raft of new measures to make sure they get back on site as quickly as possible. In May the Minister of Home Affairs produced a policy paper recommending migrant workers should be automatically enrolled for Ayushman Bharat: the Government’s flagship health insurance scheme, providing them with ready access to cashless medical facilities on site (which the vast majority either don’t have back home in the countryside, or are denied by discordant local government regulations). There will also be a new Migrant Workers Welfare Fund to make sure help housing assistance gets to where its needed most (which in this case means India’s Cities: www.labour.gov.in)…so you can be sure the pace of urbanisation on the subcontinent isn’t going to be slowing down any time soon.
India and the Subcontinent’s Housing Market
And given India’s already burgeoning need for affordable housing, it should come as no surprise either that the demand for City based real estate is likely to result in an unprecedented surge in real estate growth.
All those workers have to have somewhere to live…and there’s certainly no shortage in demand for something to build.
Which brings us back to Chennai and Mumbai: along with Bangalore, both have become centres of technological excellence, as India continues to establish itself as the planet’s distribution hub.
Skilled workers are moving there and new infrastructure systems (roads, railways and business parks) are being created on an almost daily basis, pushing house prices through the roof (so to speak). That’s undoubtedly a trend that is likely to gain added vigour from the return of migrant workers.
India needs those construction workers back on site, but it also needs to deliver affordable homes at sufficient pace to meet the dizzying needs of what was already the fastest growing population on earth.
That’s why developers on the subcontinent (and around the world) are increasingly turning into modular construction technologies, which not only reduce delivery times by 60% but also ensure cost efficient and compliant delivery standards. This is a sure-fire way to improve the subcontintent’s housing market.
After all, as India votes with its feet, it also needs somewhere to live…
Executive Overview
Modular Construction delivers faster, at lower cost and with higher quality than traditional alternatives: it’s perfectly positioned to meet the growing demand for affordable housing, not only in India but also across the world.
So as we welcome news that migrant workers are coming back to the Cities, yes: let’s give them somewhere to live too.
