The Social Impact of Globalisation: Labour, Migration, and Inequality

When India opened its economy to the world in 1991, the change was not limited to balance sheets and foreign investment figures. It reshaped how millions of people work, where they live, and who gets left behind. The economic logic of globalisation is widely discussed, but its social consequences run just as deep. Liberalised trade and capital flows have rewritten the rules of employment, pushed people from villages into crowded cities, and pulled women into factories under conditions that are far from secure. Understanding these social shifts is essential to making sense of how development actually unfolds on the ground.

How globalisation reshaped work 🔗

Globalisation is best understood as the deepening integration of economies through trade, investment, technology, and the movement of people across borders. For workers, this integration changed the very nature of a “job.” Before liberalisation, formal employment came bundled with security: written contracts, fixed wages, pensions, and protection against arbitrary dismissal. After 1991, the pressure to stay globally competitive pushed employers and policymakers toward flexibility, and flexibility almost always came at the expense of the worker’s security.

The most striking feature of the Indian labour market today is the overwhelming dominance of informal work. As of 2019-20, the informal sector employed roughly 93.6% of the workforce while contributing a little over half of national output. This is not a small corner of the economy. It is the economy, for most working people. Globalisation accelerated this informalisation by rewarding capital that could move quickly, hire cheaply, and shed workers without friction.

Labour deregulation and the new codes 🔗

Deregulation has taken two forms. There has been explicit deregulation, where protective rules were weakened or removed through legislation, and implicit deregulation, where existing rules simply stopped being enforced. Both were justified by the belief that heavy government intervention in the labour market discouraged investment and job creation.

The clearest recent example is the consolidation of labour law. The Government brought four labour codes into force on 21 November 2025, merging 29 separate central laws into the Code on Wages, the Industrial Relations Code, the Social Security Code, and the Occupational Safety, Health and Working Conditions Code. Supporters argue these codes modernise an outdated system and, importantly, extend social security to gig and platform workers for the first time.

Critics see a different picture. One major concern is the provision that raises the threshold for needing government permission before retrenchment to 300 workers, which makes it easier for larger firms to dismiss workers. Trade unions have argued that the codes legitimise informalisation and shrink the space for collective bargaining rather than strengthening worker protection. The truth likely sits between these positions, and how the rules are actually implemented at the state level will decide the outcome.

The rise of contract and insecure work 🔗

Even inside the so-called formal sector, security has been quietly eroding. The share of contract workers in organised manufacturing rose from 12% in 1990-91 to 33.6% by 2013-14. A factory might look formal on paper, but a growing portion of its workforce is hired on temporary, renewable terms with none of the stability that older generations took for granted.

This shift carries real costs for workers. Informalisation typically means irregular salaries, no wage revisions, no insurance, longer hours, and constant competition that keeps wages low. Part of the reason formal jobs failed to keep pace is structural. Growth after liberalisation was led by services and capital-intensive industries that needed fewer workers, while much of the labour-absorbing manufacturing simply did not materialise at scale.

Migration and the pull of the city 🔗

If globalisation changed the nature of work, it also changed where work could be found. As investment, factories, and service industries concentrated in and around cities, people followed. Migration became one of the defining social features of liberalised India.

Economic restructuring after the reforms created conditions for far more internal movement. Researchers note that globalisation and the subsequent restructuring of the economy created a conducive environment for greater internal migration across regions. People moved not just for opportunity but often out of necessity, as agriculture became less able to support rural households.

Push factors versus pull factors 🔗

Migration scholars distinguish between “pull” factors that draw people toward cities and “push” factors that drive them out of villages. A striking observation about Indian urbanisation is that it has been driven heavily by the latter. One analysis argues that urbanisation here has been occurring not due to urban pull but due to rural push, fuelled by poverty and agrarian distress rather than the promise of prosperity. When people are pushed rather than pulled, they often arrive in cities without skills, savings, or safety nets, and end up in exactly the precarious informal jobs described earlier.

Special Economic Zones add a further twist. These zones can act as both push and pull factors at once, since SEZs displace local residents while simultaneously attracting new migrants, producing involuntary displacement on one side and fresh inflows on the other.

Urbanisation and growing inequality 🔗

The hope was that cities would become engines of shared prosperity. The reality has been more uneven. Urban development in India has become a story of sharp contrasts, where gleaming corporate offices and residential complexes sit beside slums and shanty towns whose residents survive through casual construction work, domestic service, street vending, and rickshaw pulling. These workers keep cities running, yet their needs are routinely overlooked in urban planning.

Migration also reshapes inequality at the regional level. Internal migration tends to concentrate wealth in urban areas and widen income disparities between regions, even as remittances sent home help reduce poverty in some sending areas. Migrants also face a quieter injustice. Despite being citizens, internal migrants frequently encounter unequal access to basic services and even obstacles to exercising rights like voting in the cities where they live and work.

The feminisation of labour 🔗

One of the most significant social shifts under globalisation has been the rapid entry of women into paid employment, particularly in export-oriented industries. This phenomenon is known as the feminisation of labour. On the surface it looks like progress, and in some ways it is. But the conditions attached to this work reveal a more complicated story.

Feminisation of the labour force refers to the substantial increase in the proportion of women in paid work, driven by labour market deregulation, fragmented production, and new export specialisation that generated demand for low-paid, flexible female labour. Light-industry export zones across South and Southeast Asia came to employ a workforce that was overwhelmingly young and female. The same report makes a sharper point: women have generally been absorbed into paid work under conditions inferior to those offered to men.

Why employers prefer women workers 🔗

The preference for women in these industries was not accidental, and it was rarely about equality. Employers valued female labour partly because it could be hired on less secure contracts and offered greater flexibility. Assembly-line work in electronics and garments was repetitive and detail-oriented, and a workforce of young women could be periodically replaced as they moved through different stages of life, such as marriage or childbirth.

In India’s Export Processing Zones and later Special Economic Zones, this pattern was stark. Women constituted 70-80% of the workforce in zones like Santa Cruz and Madras, often under highly exploitative conditions and frequent breaches of labour law. The underlying logic was that women’s relative social and economic weakness made them attractive to employers: they could be paid less, worked longer hours, fired more easily, and were less likely to unionise.

A double-edged transformation 🔗

It would be unfair to paint this picture in only negative terms. Paid employment has brought women genuine gains. Earning a wage can give women greater say within the family and community, more decision-making power, and more mobility. For many women from poor rural backgrounds, a factory job is a step toward independence that earlier generations never had.

Yet the same research notes a troubling vulnerability. In a competitive global environment driven by a “race to the bottom,” women are often the last to be included in the workforce and the first to be terminated during downturns. The empowerment is real, but it rests on insecure ground. The beedi industry, employing millions of women and marginalised workers in hazardous conditions, is a reminder of how thin the line between opportunity and exploitation can be.

Connecting the threads 🔗

These three forces do not operate in isolation. Labour deregulation makes informal, insecure work the norm. That insecurity, combined with rural distress, pushes people toward cities in search of survival. And within this churning labour market, women are absorbed into export industries precisely because their vulnerability makes them flexible and cheap. The result is a workforce that is more mobile, more feminised, and more exposed than ever before.

The social dimension of globalisation, then, is a story of expanded opportunity tangled up with deepened insecurity. Growth has been real. So has the widening gap between those who benefit from integration and those who absorb its costs. The challenge for development policy is not to reverse globalisation but to build the social protections that make its gains more broadly shared.

What do you think? Do the labour codes introduced in 2025 strike the right balance between flexibility for employers and security for workers, or do they tilt too far in one direction? And when women enter the workforce through industries known for poor conditions, should we read this primarily as empowerment or as a new form of exploitation?

References

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