CHAPTER 3

MACRO ANALYSIS
3.1 INTRODUCTION
Work-family research has long been guided by the role stress theory, wherein the
negative side of the work-family interaction has been put under the spotlight. Recently, the
emphasis has shifted towards the investigation of the positive interaction between work and
family roles as well as roles outside work and family lives, and scholars have started to
deliberate on the essence of work-life balance. It should be noted that the term work-life is used
throughout this chapter from here on as it is more comprehensive than the term work-family.
However, when the work of other scholars is referred to, the terms work-life and work-family are
used according to the citations.
It is generally agreed that work-life balance is important for an individuals psychological
well-being, and that high self-esteem, satisfaction, and overall sense of harmony in life can be
regarded as indicators of a successful balance between work and family roles. However, there is
a lack of consensus on how work-life balance should be defined, measured, and researched, and
thus, the theorizing of what constitutes work-life balance, how it develops, and what factors
enable or hinder it, is still in progress have also questioned the self-evident assumption that
work-family balance always leads to favorable outcomes since according to them this is an
empirical question which has not yet been firmly answered due to miscellaneous definitions of
work-family balance.
Productivity
Labour productivity is defined as total output divided by labour inputs and is considered
as a necessary, though not sufficient in itself, condition for long-term profitability and success
(Guthrie, 2001).

The Department of Labour established a Workplace Productivity Working Group (WPWG) in
February 2004 to determine ways to improve workplace productivity that will produce higher
wages and a high value economy. The Group produced a report in August 2004 on how New
Zealand compares with other countries, what practices have been successful or unsuccessful, the
effect of policy settings on workplace productivity and possible future policy options for
improving productivity (WPWG, 2004). Among the findings of this report were the need to
create productive workplace cultures and measure workplace productivity and successful
business practices. It also acknowledges the relationship between employee motivation and
productivity.
People tend to be more motivated in the workplace if they feel appreciated and respected.
Creating a positive work environment not only boosts morale but also productivity levels.High
performing workplaces are founded on a strong workplace culture in which motivated and
engaged employees are willing to go the extra mile.
The WPWG report notes that barriers to introducing practices to improve productivity
include the short-term costs of new practices and strategies in relation to short-term benefits, a
lack of buy-in and a belief that such practices will lead to competitive disadvantage rather than
competitive advantage.
Working Time Solidarity and Working Time Flexibility: Towards a Redistribution and
Deregulation of Working Hours
Another important dimension in enhancing a work/life balance, apart from the role of stereotypes
in the division of paid and unpaid work between women and men, is the issue of working time,
and how it is organised and distributed.
In a context of persisting high unemployment levels and jobless growth, a number of unions
have been urging since the mid-80s- for a redistribution of working hours between those
already in employment (often with a lot of overtime work) and the unemployed. Several patterns
of working time redistribution have been adopted across Europe over the past 15-20 years.

The more widespread patterns include:
The reduction of the working week (usually to 35 hours a week) with no loss in pay. The most
prominent example is France, where the introduction of the 35-hour week applies across the
board, since 2001. The reduced working week is a reality, however, in a growing number of
sectors and individual companies and organisations in many European countries (mostly in
Germany, the Netherlands, Belgium, etc.).
Job rotation schemes (mostly Denmark), whereby an unemployed person replaces an employee
on paid leave (for training or other purposes), for a period of 6-12 months. Redistribution of
working time through financial incentives- between full time male workers and women part-
timers (the Netherlands), or, otherwise, between working hours rich and working hours poor.
The redistribution of working hours goes hand-in-hand with the increased flexibilisation of
working time. Although fixed, regular hours are still the most widespread pattern of working
time organisation, increasingly irregularity of working hours is steadily becoming standard
andtypical in many firms and organisations.
According to recent a report on the quality of work by the European Foundation for the
Improvement of Living and Working Conditions, 37% of employees in the E.U. do not work the
same number of days each week and 24% have different working weeks within a month
(European Foundation, 2002). Moreover, the range of potential forms of time management is
wide and constantly expanding. [see Box 2 below] Apart from flexibility of working hours, other
aspects of time organisation that also need to be taken into consideration are the duration of the
working day/week, the predictability of working hours (in a context of growing de-
standardisation of working patterns), and the overall organisation of social (or urban) times. The
role of the national or supra-national institutional framework is to lay down the necessary
regulatory conditions and set the minimum standards regarding the terms and conditions of
employment and various individual rights that may then be supplemented and improved in the
collective labour agreements. It also has a wider educative role, often showing the way ahead
and exerting a significant social and political influence, as in the promotion of equal
opportunities, of anti-discrimination policies, etc.
National Committee on Banking 2012-13, conducted a Survey on the Health of the Indian
Banking Sector in the Current Regulatory Environment. The Survey analyzed the prevailing
market conditions vis--vis asset quality, capitalization of banks and growth estimate of the
Banking sector, while focusing upon the current regulatory environment and its impact on bank
business and profitability.
A total of 15 banks participated in the Survey, including 5 from the Public Sector, 3 private
banks, and 7 foreign banks. As per the Survey findings, the respondent banks have estimated a
deterioration in key performance indicators in the current fiscal (FY 2012-13) including Credit
Growth, Net Interest Income, Growth in Profit After Tax (PAT) and Return on Equity. Further,
the banks expect to face increased pressure on their financial health, owing to stricter regulatory
requirements, going ahead.
Survey Findings
On the impact of major regulatory requirements on banks profitability, the Survey brings out
that the Basel III capital requirements are likely to have the highest impact on the profitability of
the Indian Banking sector, followed by the revised guidelines on Priority Sector Lending (PSL).
Further, higher provisioning norms for restructured assets are also expected to have major impact
on banks profitability, as highlighted by the respondent banks.
Profitability of Indian Banking Sector Projected to Decline
The profitability of the Indian banking sector is projected to decline sharply as financial health of
banks take a hit owing to impact of stricter regulatory requirement amid rising stress on asset
quality, according to a CII Survey.
The CII Survey titled Health of Indian Banking sector in current regulatory environment
assessed the prevailing market conditions vis--vis asset quality, capitalisation of banks and
growth estimate of the banking sector while focusing upon the current regulatory environment
and its impact on bank business and profitability. A total of 15 banks participated in the Survey
including 5 Public Sector Banks (PSBs), 3 Private Sector Banks and 7 Foreign Banks.
As per the survey findings respondent banks have estimated deterioration in key performance
indicators in the current fiscal (FY 2012-13) including Credit Growth, Net Interest Income,
Growth in Profit After Tax (PAT) and Return on Equity. Further, banks are expected to face
increased pressure on their financial health owing to stricter regulatory requirements going
ahead.On the impact of major regulatory requirements on banks profitability, the survey brings
out that the Basel III capital requirements are likely to have the highest impact on profitability of
the Indian banking sector followed by the revised guidelines on Priority Sector Lending (PSL).
Further, higher provisioning norms for restructured assets are also expected to have major impact
on banks profitability as highlighted by the respondent banks.
Besides stricter regulatory requirements, surveyed banks foresee deteriorating asset quality as
one of the most critical challenges impairing profitability of Indian banking sector. The Gross
NPAs level of the Indian banking sector which was already at its highest level in last six years
(as at end March 2012) is expected to worsen with significant rise in restructured loan
accounts.Raising concerns on the deteriorating asset quality of the Indian banking sector, 80 per
cent of the respondent banks foresee a rise in their NPAs level while 88 per cent of surveyed
banks have projected an increase in their restructured loan accounts in current financial year,
which would impact the profitability of the banking sector.
The respondent Private sector banks are found to be maintaining an average CAR of 12 -16 per
cent during the same period. For foreign banks, the Survey indicates that most of smaller foreign
banks are already well capitalized to meet the Basel III targets whereas big foreign banks are
expected to raise their capital level through head office capital infusion.On revised PSL
guidelines, reclassification of certain advances as SME instead of agriculture and declassification
of indirect financing to agriculture shall put some stress on achieving priority sector targets for
agriculture. In addition, foreign banks with more than 20 branches are likely to face difficulty in
meeting the increased PSL targets.