Punjab’s updated LSM wages and employment data through June 2025 point to a labour market that is becoming more uneven, with rising nominal wages masking declining real earnings for most industrial workers. The broad contours from earlier datasets still hold, but the latest numbers give a sharper picture of how far industrial pay has fallen behind both inflation and statutory wage floors.
To understand the scale of the shortfall, it helps to compare LSM pay with wages from outside the manufacturing economy. Daily-wage construction workers such as masons, electricians, carpenters, and painters are not part of the large-scale manufacturing sector, yet their earnings provide a useful benchmark for the price of labour in Punjab’s wider economy.
When placed side by side, construction wages sit above the average pay in most LSM industries. Even after adjusting for inflation using a basic CPI deflator, construction workers still fare better than production workers in key LSM industries including cotton, cement, pharmaceuticals, sugar, and ghee.
This inversion of the typical wage hierarchy is telling. Manufacturing has historically been associated with stable jobs and upward income mobility. The updated data show that this relationship has weakened considerably. Although nominal wages have increased across most industrial categories since 2021, the rise has been too slow to keep pace with inflation or statutory wage increases. Punjab’s minimum wage has risen from Rs 17,500 to Rs 39,000 between FY21 and FY25, yet no major LSM sector has kept up.
The picture is bleaker for the largest employers. Cotton, which accounts for the biggest share of LSM employment, pays an average monthly wage of around Rs22,000. Sugar, cement, and pharmaceuticals are also well below the statutory benchmark. These gaps persist because employers often rely on daily-wage labour, casual contracts, shorter official work hours, and job reclassification, which allow them to operate outside minimum wage compliance despite large workforces.
Employment trends underline the structural imbalance. Sectors that pay relatively higher wages are not expanding their labour force. Cement wages have risen to about Rs100,000 a month, but employment has fallen from nearly six thousand workers to fewer than four thousand. Fertilizer wages have doubled to around Rs150,000, yet the number of workers has stagnated or declined. Sugar mills have added workers, but their wages remain volatile and below wider labour market benchmarks. Meanwhile, mass employers such as cotton and textiles have barely increased wages while their real earnings have eroded.
When both datasets are viewed together, the conclusion is straightforward. Nearly seventy percent of Punjab’s LSM workforce is earning less in real terms than four years ago. The sectors that employ the most people pay the least, and the sectors that pay better employ fewer people. This is the opposite of what a healthy industrial labour market looks like.
Punjab’s industrial wage data rarely enters policy discussions, but it signals stress that will compound over time. Declining real wages weaken household consumption, discourage labour force participation, and undermine the narrative that manufacturing can anchor middle-class growth. Without stronger enforcement of statutory wage rules, clearer classification of labour contracts, and a broader conversation on industrial pay structures, real incomes for industrial workers will continue to fall.
The updated FY22–FY25 numbers reinforce a central point. Punjab’s industrial base may still be producing output, but it is no longer producing income growth for its workers.