The classical problem a segmentation model tries to solve is to identify the 'awesome' from the 'average'. The sample/population could be anything.
For a daily wage earner the model would suggest moving to Kerala. Let's narrow it down to a small district in Kerala, Pathanamthita. As of 2009, the bank deposits for the Kumbanad-Pullad-Thiruvalla belt were estimated to be at 54 billion. Remittances from the Middle East formed a major part of these deposits.
The economy in this belt is mostly powered by NRI money, which, apart from getting parked in banks, goes into buying or building houses. The only problem to building houses is that there is a crippling labour shortage. To give you some perspective Kerala has the highest wage rate in the country. A daily wage earner earns Rs 600 per day which is more than double of what he would have earned elsewhere while a mason earns about Rs 750 per day. Do the maths and a daily wage earner/mason would earn a fair amount of money in a month. It’s a puzzling phenomenon that there exists a perennial shortage of labour in the state even with these high wage rates while the law of supply states that the quantity of a good supplied rises as the market price rises.One of the many reason why we see high unemployment rates in the state is due to the absence of industries that require skilled labour ( more about that in the next blog).
So as to fill in this shortage, migrant labour from all over the country are making their way to the state.
Kerala now has 2.5 million migrant labour engaged for manual work in various sectors including construction. About 235 thousand migrant workers continue to get added into the State's labour pool each year. Remittance to their home states have been pegged at Rs. 175 billion. It’s an interesting case in point to illustrate how dependent the state is on migrants while the local population make their way out of the stage to work elsewhere. With the drop in oil prices remittances to the state from the Middle East may decrease and this turbulence may be felt in states far from Kerala.
On a side note, if you are a Malayalee looking to marry, the segmentation model may point you to the Kumbanad-Pullad-Thiruvalla area. For the interest of anyone planning to get a partner from there solely for the money, let me warn you they pack a wicked punch!
How do I know?
My wife is from Pullad.
#data credit-
For a daily wage earner the model would suggest moving to Kerala. Let's narrow it down to a small district in Kerala, Pathanamthita. As of 2009, the bank deposits for the Kumbanad-Pullad-Thiruvalla belt were estimated to be at 54 billion. Remittances from the Middle East formed a major part of these deposits.
The economy in this belt is mostly powered by NRI money, which, apart from getting parked in banks, goes into buying or building houses. The only problem to building houses is that there is a crippling labour shortage. To give you some perspective Kerala has the highest wage rate in the country. A daily wage earner earns Rs 600 per day which is more than double of what he would have earned elsewhere while a mason earns about Rs 750 per day. Do the maths and a daily wage earner/mason would earn a fair amount of money in a month. It’s a puzzling phenomenon that there exists a perennial shortage of labour in the state even with these high wage rates while the law of supply states that the quantity of a good supplied rises as the market price rises.One of the many reason why we see high unemployment rates in the state is due to the absence of industries that require skilled labour ( more about that in the next blog).
So as to fill in this shortage, migrant labour from all over the country are making their way to the state.
Kerala now has 2.5 million migrant labour engaged for manual work in various sectors including construction. About 235 thousand migrant workers continue to get added into the State's labour pool each year. Remittance to their home states have been pegged at Rs. 175 billion. It’s an interesting case in point to illustrate how dependent the state is on migrants while the local population make their way out of the stage to work elsewhere. With the drop in oil prices remittances to the state from the Middle East may decrease and this turbulence may be felt in states far from Kerala.
On a side note, if you are a Malayalee looking to marry, the segmentation model may point you to the Kumbanad-Pullad-Thiruvalla area. For the interest of anyone planning to get a partner from there solely for the money, let me warn you they pack a wicked punch!
How do I know?
My wife is from Pullad.
#data credit-
- http://www.thehindubusinessline.com/news/migrant-worker-population-in-kerala-touches-25-m/article4421810.ece
- http://forbesindia.com/blog/business-strategy/overcoming-labour-shortage-the-kerala-way/