The rise of 10-minute deliveries in industries like groceries, fast food and even fashion has begun shaking up India’s garment and textile sector in unexpected ways. As the gig economy booms and welfare schemes expand, manufacturers face a growing challenge: fewer workers are willing to stay on the factory floor. With gig jobs offering flexible hours, better pay and government support increasing for them, garment makers are scrambling to fill positions.
In India, the number of gig workers has already grown to about 10 million, a 30 per cent increase from 7.7 million in 2020-21. This number is expected to reach 23.5 million by 2029-30, a huge rise of 135 per cent.
According to the staffing company TeamLease Digital, about 97.6 per cent of gig workers in India earn less than Rs. 5 lakh (US $ 5,845) a year. Of those, more than 75 per cent earn Rs. 2.5 lakh (US $ 2,922) or less annually and nearly 20 per cent earn between Rs. 2.5 lakh and Rs. 5 lakh.
The remaining 2.6 per cent of gig workers earn between Rs. 5 lakh and Rs. 7.5 lakh (US $ 8,767) a year.
While the average wage in India’s garment sector hovers around just US $ 168 (Rs. 13,870), the gig economy is offering far more flexibility and competitive pay, making it harder for manufacturers to hold on to their workforce.
To put icing on the cake, the government has announced in this year’s budget that gig workers will get identity cards and be registered. There are also plans to introduce a pension scheme requiring platform aggregators such as Zomato, Blinkit, Swiggy and Uber to contribute 2 per cent of each worker’s income.
On top of that, welfare schemes like Pradhan Mantri Jan Dhan Yojana, Ayushman Bharat, Gramin Awaas Yojana, Garib Kalyan Anna Yojana and MGNREGA are offering free access to banking, healthcare, housing, food and guaranteed rural employment. As a result, factory jobs are becoming less attractive for many migrant workers, further shrinking the labour pool in India’s textile sector, which directly employs over 45 million people, many of whom are from rural areas.
| While the average wage in India’s garment sector hovers around just US $ 168 (Rs. 13,870), the gig economy is offering far more flexibility and competitive pay, making it harder for manufacturers to hold on to their workforce. The government has announced in this year’s budget that gig workers will get identity cards and be registered. |
Manufacturers Battle Worker Shortages
There are over 140 million migrant workers in India, contributing to estimated 10 per cent of the GDP. According to the 2020-21 Migration report from the Ministry of Statistics and Programme Implementation, the overall migration rate is 28.9 per cent, with 26.5 per cent from rural areas.
For example, Tirupur, known as India’s ‘knitwear capital’, relies heavily on migrant workers from states like Uttar Pradesh, Bihar, Jharkhand, Odisha and West Bengal, but is now facing a shortage of 100,000 to 150,000 workers. Last year, to solve this, the Tirupur Exporters Association (TEA) started a large job drive and offered higher wages to bring workers back.
“We depend on migrant workers, mostly from Odisha, Jharkhand and Bihar. Sometimes, we face challenges because they travel together in groups and leave the same way. This causes problems with our planning,” stated Vivekanand Palanisamy, MD, Armstrong Knitting Mills, a vertically integrated manufacturer in Tirupur with around 5,000 workers and an annual turnover of over Rs. 400 crore (US $ 48 million).
“Tirupur depends on migrant labour. It’s about 50 per cent local workers and 50 per cent migrant workers here. Right now, it’s tough to find enough workers. It’s not easy—lots of resources are being used to hire workers,” said Ashok, CMO, SCM Garments Pvt. Ltd., an apparel manufacturer producing 14 million garments a month, including menswear, womenswear and kidswear. “We need 25,000 workers to run at full capacity,” he added.
Echoing similar sentiment, Amrith Govindan Kutty, Senior GM, Marketing and Merchandising, Sakthi Infra Tex Pvt. Ltd., a vertically integrated manufacturer based in Perundurai, Tamil Nadu, said, “There’s not enough labour available, and today, people prefer easy money. Our industry needs workers to meet targets.” The company, with US $ 200 million in sales, produces over 6 million units per month, specialising in a wide range of knitwear for infants, boys, girls, men and women.
“There’s definitely a problem because welfare schemes give workers many choices, making it easier for them to pick and choose jobs,” said Pradeep Modi, MD, Just Textiles Ltd. (Aquafree), a textile manufacturer that specialises in dyeing, finishing and printing fabrics to meet the colour continuity needs of bulk clients for exports and defense. It has a monthly capacity of 4.5 million metres for woven fabrics and 250 tonnes per month for knit fabrics.
Whereas, Vishwanath Chodvadiya, Director and CEO of Belcon Tex Pvt. Ltd., based in Surat, stressed that the workforce challenge goes beyond just availability. “To run a factory with 800 machines, we need a good number of workers, which is hard to find,” he explained. Belcon Textile Pvt. Ltd., which manufactures a wide range of fabrics for apparel, ethnicwear and home furnishings, has an annual weaving capacity of 90 million metres.
Experts also mentioned that the gig economy is making worker shortage worse in big cities. “In metro cities, gig work is more popular because workers have many options and are less likely to commit to one company,” said Ayushman Agnihotri, Director, Akshaj Knitters Pvt. Ltd., a manufacturer, exporter and wholesale supplier of warp knitted fabrics and laces based in Amritsar.
Meanwhile, retail is emerging as another powerful magnet with over 40 million people already employed and an estimated 25 million new jobs, mostly in sales and other unskilled roles by 2030.
Factories Head to the Hinterland, Where the Labour Is
To tackle labour shortfall, manufacturers are making a strategic shift, moving to the hinterland to tap into the readily available workforce.
This move makes perfect sense as a recent report shows that over 60 per cent of rural male youth and nearly 70 per cent of females prefer staying close to home rather than migrating for work.
The insights come from a nationwide survey across 21 states, conducted by Global Development Incubator, Transform Rural India (TRI) and Sambodhi Research, in collaboration with the Development Intelligence Unit (DIU). It found that only about 32 per cent of men and 24 per cent of women are open to migrating for jobs.
In response, companies are now setting up shops closer to villages. For example, Pratibha Syntex, invested Rs. 355 crore (US $ 41.5 million) to open a new facility in Ninora village, near Ujjain, in 2024. The company annually produces over 60 million pieces and employs over 5,500 workers.
“After Covid, we had to change our strategy. A big part of our workforce working in our Indore plant was made up of migrant workers, and when they had to leave, our business suffered. Now, we’re training workers from nearby villages to keep everything running smoothly,” expressed Karan Malhotra, Business Development Manager, Pratibha Syntex. This unit employs more than 70 per cent women from nearby areas.
To make the move to rural areas even more appealing, various states are offering incentives like stamp duty reimbursement, power tariff subsidies, wage subsidies and ESI/EPF benefits to attract textile and garment manufacturers.
Zeel, claiming to be India’s largest seasonalwear manufacturer, operates more than five factories across Madhya Pradesh, Rajasthan, Maharashtra and Bihar, with over 8 lakh sq.ft. of manufacturing space.
With an annual turnover of Rs. 600 crore (US $ 70.14 million), Zeel employs 10,000 workers, 80 per cent of whom are women. “In Rajasthan, we have the largest training centre, where we train 1,800 women in garment making over 6-8 months before offering them employment. Most of the women working in our factory come from nearby villages. In Madhya Pradesh, 2,000 tribal women are trained at our centre and we provide hostel facilities for those living far away,” shared Rajeev Sharma, Business Head of the company.
Another player taking advantage of this trend is Texport Industries, an apparel manufacturer with 12 plants across India, including new units in Shiggaon (Karnataka), Kadapa (Andhra Pradesh) and Sircilla (Telangana). Texport employs 12,000 workers.
“First we build factories where labour is available, train workers from day one and instill the right culture and discipline. We’re doing this in our new manufacturing units as well. Second, we don’t hire migrant workers, so we don’t need to provide accommodation. Thirdly, around 95 per cent of our workforce are women, mostly second breadwinners of their families, making them more disciplined,” highlighted Raghavendra Shah, Senior VP, Texport Industries.
Others too are making a beeline for rural India. Textile giant Arvind Ltd., is investing over Rs. 100 crore (US $ 11.54 million) to set up a clothing plant in Varanasi, Uttar Pradesh. Indian Oil Corporation is entering yarn manufacturing with a Rs. 4,382 crore (US $ 505 million) facility in Bhadrak, Odisha, in partnership with MCPI Pvt. Ltd., contributing Rs. 657 crore (US $ 76 million).
Vardhman Textiles is expanding its Budhni facility in Madhya Pradesh with Rs. 350 crore (US $ 40.40 million) investment to boost processed fabric capacity by 31 million metres annually. Sutlej Textiles is developing a greenfield plant in Kathua, Jammu & Kashmir, with 89,184 spindles and a dye house, set to begin production by Q4 of FY ’25.
Aditya Birla Group is eyeing expansion in Begusarai, Bihar, while Sonal Apparel is also gearing up to start operations in the state. In Gujarat’s Kutch region, Welspun Living is building a facility for bed linens and terry towels.
Meanwhile, six Noida-based apparel companies and one from Bengaluru are investing Rs. 379 crore (US $ 43.73 million) in Odisha’s Khurda garment cluster.
Taking note of the situation, the government’s education, skill and labour ministries are working together to carry out skill mapping. However, some players point out that there’s still a reluctance among top management to shift base to the hinterlands, largely due to the lack of amenities such as quality healthcare, education and recreational facilities for them and their families.
| “First we build factories where labour is available, train workers from day one and instill the right culture and discipline. We’re doing this in our new manufacturing units as well. Second, we don’t hire migrant workers, so we don’t need to provide accommodation. Thirdly, around 95 per cent of our workforce are women, mostly second breadwinners of their families, making them more disciplined.” Raghavendra Shah, Senior VP, Texport Industries |
Smaller factories with 100-200 workers that can’t move their locations are also solving labour shortage in their own ways, by offering food, accommodation and better working conditions. “We provide food and lodging for our workers close to the factory,” said Ajay Dodia, President, Om Creations, a Surat-based manufacturer of knitting fabric. The company has an annual turnover of Rs. 100 crore (US $ 12.05 million).
Similarly, Sunil Mehra, Director, DRM Group in Amritsar, a manufacturer and exporter of woolen textiles and yarns, shared, “We provide clean and comfortable housing with essential amenities like food, clean drinking water and hygienic conditions. Every worker gets a mattress and blanket and all our factories are stocked with medical kits.”
Other companies like Belcon Textile are also offering these amenities to workers and offer slightly inflated wages to make the deal more attractive.
“We focus on providing our workers with the right kind of wages,” said Ronak Agarwal, Director, Khazana Group of Industries, a manufacturer of wide range polyester knitted fabrics with an annual turnover of over Rs. 500 crore (US $ 58.45 million).
While challenges remain, the industry is constantly finding new ways to remain competitive, resilient and future-ready.
