An analysis of the saving behaviour of the workers employed in the steel industry in Chandigarh

Motivated by the fundamental role played by savings in determining India's economic growth and important position occupied by the steel workers as potential source of savings and subsequent capital formation in Indian econnomy, the present study analyses and examines the saving behaviour of industrial workers employed in steel firms in chandigarh. Using questionnaire-interview combination, a survey was carried out on 100 industrial workers in 2013 to study their saving behaviour, which is multifaceted in nature. The results of the present study indicate that channelization of savings in saving deposits and Life Insurance certificate were observed to be the most sought after financial instruments among the industrial workers. While maximum number of workers opted to deposit their monthly savings with the commercial banks, only a small number of workers chose to keep their savings with the employer. Requirement of the family needs, guarding against unforeseen contingencies and provision for old age were observed to be the main motivating factors for saving, while lack of affordability, followed by perceived lack of trust in the financial institutions and low rate of interest were cited as the main reasons which deterred workers to save. Borrowing from their relatives, friends and employer were found to be the preferred options resorted by the workers to meet out the deficit whenever their consumption requirements exceeded their income levels. Further, the study indicated that while the decision to save by the workers is mostly guided by the advice from family, friends and relatives, however workers’ own experience and personal knowledge was also observed to be a prime factor in determining their saving decisions.