Abstract
As an industrial cluster develops, demand for a labour force in the duster may increase. There are two sources of labour forces in developing countries. First, surplus labour from surrounding villages joins the manufacturing sector. If employment in agriculture is unstable and offers low income, the manufacturing sector may provide better employment opportunities for surplus labour. Therefore, the labour force may shift from agriculture to industry. Many factories outsource labour-intensive processes to households in surrounding villages, a practice that may improve household incomes. Second, the expansion of labour demand in an industrial cluster induces inflows of migrant workers from remote villages. They move to an industrial cluster for employment opportunities and the ability to send remittances to their families back in their home villages. Migrants compare incomes in their home villages with expected incomes from factories in industrial clusters. As the labour force in industrial clusters depends on migrant workers, their inflow affects the cluster’s labour market. If wage and employment conditions are not attractive, the labour force does not shift from agriculture to industry.
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Uchikawa, S. (2014). Introduction: Development of Industrial Clusters and the Labour Force. In: Uchikawa, S. (eds) Industrial Clusters, Migrant Workers, and Labour Markets in India. IDE-JETRO Series. Palgrave Macmillan, London. https://doi.org/10.1057/9781137408778_1
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DOI: https://doi.org/10.1057/9781137408778_1
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