In the last 2 years since UBER established in India, there
has been a major social change that is not yet fully felt and understood. Now, it is fashionable to become an UBER
driver. More importantly, it pays well
to be an UBER driver.
School dropouts are now able to earn about Rs.60,000 per
month; that is more than Rs. 7 lakhs per year!!
UBER currently has more than 50,000 drivers in India. These drivers were perhaps making less than
Rs.20,000 per month earlier. Now their
salary has gone up 3 times. UBER
singlehandedly has added Rs.2400 crores to the Indian economy in the last year.
Perhaps more important is that several of them now own their
cars. That is another Rs.2,000 crore to
the auto industry. But all this is
nothing compared to the ripple effect that UBER is going to create very
shortly.
The IT companies which recruit fresh graduates from
engineering colleges pay only about Rs. 4 lakhs per year. And, that too to people who have spent 4
years studying engineering and spending at least Rs. 5 lakhs for the
program.
Contrast that with the Uber
driver who makes Rs. 7 lakhs per year without spending too much time or money
to get trained. Uber is now going all
out in the country to recruit drivers.
They have committed 30,000 jobs in Tamilnadu alone last week. So, the IT companies are going to face a
tough competitor in talent recruitment.
What will happen?
The IT companies will be forced to raise the salary levels
for these entry level candidates. It is
not just the IT companies who will be forced to raise salary levels. Construction companies, hair dressers,
Government offices, hospitality industry, almost every other industry will be
forced to raise salary levels. In
effect, the average minimum wage in the country will go up to Rs.60,000 per
month. This is the virtuous cycle that
UBER has unleashed.
I bet that this will happen in the next 2 to 3 years. Imagine what will happen to the Indian
economy. More people can afford to buy
more goods such as a nice house, refrigerators, air conditioners, TV sets,
motorbikes, cars, send their kids to good schools, etc. – in effect, our
factories will be producing more to be sold within India. Make in India will actually be Make for
India!! This increase in the size of the
domestic market will bring prices down since the volume has gone up. This will make our companies very competitive
internationally and so we can sell more overseas – our exports will go up.
