India’s key textile-producing states, Gujarat and Maharashtra, are grappling with an acute labor shortage, disrupting fabric and garment production across the region. Being highly labor-intensive, these sectors have been particularly hard hit by the reduced workforce. Gujarat’s well-known textile hub, Surat, has witnessed up to a 50 per cent decline in textile factory output. However, weak retail demand may prevent price hikes despite slower textile supply.
Surat is renowned for its weaving, processing, and garmenting activities—all of which rely heavily on manual labour. A large portion of the workforce hails from Uttar Pradesh and Bihar and typically returns to their native villages during summer for one to two months. These workers are not permanently employed but are paid based on output, making their absence financially consequential for them, yet beyond the control of factory owners. Many leave to engage in agricultural work or assist with harvesting, where they often earn higher seasonal wages.
Ashish Gujarati, Former President, Southern Gujarat Chamber of Commerce & Industry (SGCCI), says factories are compelled to reduce production by up to 50 per cent as the textile industry faces a labor crunch. It is estimated that around half of the workforce has gone on leave to their native states. Workers are expected to return after the first rains, likely in the second half of June. He adds, power looms and auto looms are facing the most severe worker shortages. Textile processing and garmenting are also affected.
The textile industry is facing similar challenges in other parts of Gujarat and Maharashtra. Bharat Shah, a power loom owner in Ichalkaranji (Maharashtra), states, power looms have had to cut fabric production as the number of workers has dropped in the past two to three weeks. Labour shortage has become an annual issue as industries are increasingly dependent on workers from UP and Bihar. These workers typically return by the end of June when the rainy season starts.
Labor shortages have dented textile factory production, but a sudden drop in supply or spike in fabric prices is unlikely. There are clear signs of consistent supply and stable prices, unless there is an unexpected surge in demand for end products like garments and other finished goods. Shah explained that this is an annual labour migration, and factory owners have already planned production accordingly. Wholesalers have also built up adequate stock for the summer months.
More importantly, the current demand for textiles and garments is steady to slow, which is not conducive to price increases.
Gujarati further notes, a short supply is unlikely during the summer months unless there is a sudden rise in demand. The present level of demand has already been factored in by manufacturers. This steady to slow demand will not cause a shortage of supply. However, occasional short supply of specific textile varieties may be experienced during this period of slow production.
K M Subramanian, President, Tiruppur Exporters’ Association, avers. garment manufacturing units in the Tiruppur region are also facing a labour shortage. There is a shortage of around 40,000 workers in the region. Workers are getting better jobs in other sectors including IT sector, which is the main reason for the labour shortage. Growing IT and other sectors need non-technical workers for supporting and ancillary services. Garment production activities are being affected by this problem.
However, another industry expert said that the region is not facing a seasonal labour shortage, as workers in the region typically return to their native places in Uttar Pradesh and Bihar before the Holi festival. They are now coming back to the factories.
