New Delhi: Women in India represent only 24% of the paid labour force, as against the global average of 40%, according to McKinsey Global Institute report 2015. Even though the proportion of the economically active population (15-59 years) increased from 57.7% to 63.3% between 1991 and 2013 (Sample Registration System data, 2013), the labour force participation rate for women is significantly lower than that for males.
According to estimates based on International Labour Organization’s (ILO) Trends Projections Model, in 2030, the female labour force participation rate is projected to reach just 28.3%, up from 26.9% in 2016. The under-representation of women in India’s labour force has been a chronic problem. A recent book Transformation of Women at Work in Asia: An Unfinished Development Agenda, edited by Sukti Dasgupta and Sher Singh Verick, examines the drivers of and barriers to participation of women in the Asian labour market. Verick, who is the deputy director of the ILO Decent Work Team for South Asia and Country Office for India, says unless India addresses the inclusion of women in its growth story, the country will never meet its target.
Edited excerpts from an interview:
India has been growing, but to what extent have women gained from this transformation and to what extent have they been a part of it?
The recent National Sample Survey Office data told us India was growing at 8% per annum, and the labour force data showed falling women’s participation—and it fell most extensively in rural areas and particularly in agriculture.
Clearly, there has been a transition of women out of agriculture but at the same time, the growth hasn’t particularly helped women in the sense of them entering new jobs in other sectors. This decline (in formal workforce) is only a part of the story.
The real story is the low level of participation. The fundamental issue is that if India is to achieve a sustainable, inclusive growth path, then it is very important to look at women having more opportunities to join the workforce. It should not be compulsory, obviously. It is about giving the opportunity of choice. This is not a story to sit outside the scope of economic policy.
This is at the heart of economic policy. Unless you address the inclusion of women in India’s growth story, you will never be meeting your potential. Women have been directly and indirectly part of India’s success story but in many unwritten ways. They have been the unsung heroes. We are not talking about urban elite, but the bulk of the population, living in rural areas.
Is it right to automatically expect changes in female workforce participation if a country’s per capita GDP is increasing?
This question has been debated for decades globally. There has been this belief that there is a relationship between women’s workforce participation and economic development as captured by GDP per capita. There is a U-shaped hypothesis, according to which in the poorest countries, there is high women’s participation—because women have no choice but to work because of poverty.
As countries become more prosperous, women start withdrawing from sectors like agriculture. Then as new opportunities emerge in services, women start entering those sectors. People sometimes say women withdrawing from the drudgery of agriculture is just a part of the development process. That is correct. But if they withdraw and have no opportunities, it is also an issue of concern. Things will not settle by themselves as a natural process.
Clearly, one should be concerned about what is needed to provide those opportunities for women. As they are getting more educated, as they are having fewer children, the other things like skill development, job creation, safety, will need to be there in place as well. So, the U-shape is a stylized factor, not borne out by any deep analysis. You have a country like Bangladesh, a low-income country, but one which has made rapid gains when it comes to the participation of women. They have also made important gains in women’s education and empowerment. You have the garments sector with many opportunities for women to join. Agriculture also brought many options through the microcredit system.
If a country does not follow the classical path of development in terms of manufacturing sector playing a dominant role in the process of structural transformation, how does that impact women in the world of work?
This is more of a historical fact now, because most countries are not following that traditional transformation process. It is not only India where manufacturing has remained on a smaller scale. The real issue is where will these women leaving agriculture be absorbed?
Government of India is pushing for manufacturing sector to take a bigger role. It is important because it won’t happen by itself. Again, India is a diverse country, and every state demands different things. Policy needs to not just promote one sector over the other uniformly (across states), but it has to come up with a more disaggregated plan— particularly at the state level—looking at what sectors are growing and which ones can absorb women. What are the missing skills?
Even in manufacturing, skills are required. Jobs have to be created. If jobs are not created, there is only so much you can do on the supply side. We need to look at where the investment is going, in which sectors, and whether that is benefiting women. Not everyone will be able to or should migrate to one place where growth is happening. That isn’t an optimal thing for the country. It is how you manage the process across the smaller towns that is important. The future, of course, will be the smaller towns and how they are able to grow and generate jobs, and where women figure in that scheme of things.
High growth should mean more jobs not just for men, but women as well. So where is the leak?
The fundamental issue is who accesses those jobs, and who has the chances to set up their own businesses (in case of entrepreneurs). If you look at the employment trends that people call jobless growth, it was driven by two countervailing trends—one, we have men entering the market at very healthy rates, and in urban areas.
On the other hand, we have women’s employment declining in rural areas. So men are getting jobs. We can question the quality of those jobs, but they are getting jobs. The issue is that the women are withdrawing and not joining other sectors in healthy numbers. In some sub-sectors, there have been some healthy trends. The situation will change because the aspirations are changing, expectations are changing. The issue is whether they will be able to meet those expectations, will they get the jobs they desire. The story is very clear—that the men have benefited more than women.
For more than a decade now, female education levels in India have been rising. It is one of the reasons for the fall in female workforce participation, but is it necessarily a bad thing, if we look at the benefits the country can reap in the future? What role does education play in determining women’s outcomes in the labour market?
Young women staying in schools and universities means they wouldn’t be counted in the labour force. There has been a withdrawal due to education, but that is not the major factor. The bigger issue is to what level education pays and how it changes your circumstances and opportunities.
What we see clearly in India, also in Sri Lanka and other places, is that returns of education only kick in, in terms of being able to access better jobs, regular and salaried work, when you have had more than secondary education. Once you have tertiary education, your opportunities increase. Your ability to earn goes up. This issue about what level of education is going to pay is very important, and getting those post-secondary skills is very important—particularly in the urban labour markets.
So if a rise in enrolment doesn’t ensure increased labour workforce participation, what are the various conditions that need to change?
Social norm change is a long-term process and it is naive to think one can change these quickly. But some of the key policy pillars that need attention include need to create jobs...but policymakers need to ensure those jobs are also accessible to women. Then, jobs created have to be matched by other things—like transport infrastructure, education skills, entrepreneurship, reducing women’s time burden, focusing on childcare, and safety. Issues around legal rights and protection of women should be a focus. This isn’t what just one ministry should focus on in any country. It is not just the issue of gender, but it goes to the heart of the growth path a country will follow.
A lot has changed. Even in something as basic as technology, the gender barrier has faded...
Technology is a great enabler and has a potential for people to do lot of home-based work—in an innovative, modern sense, not in a traditional embroidery sense. We don’t yet see that in the figures.
This is the future, and this is why, I keep stressing on entrepreneurship, because the new models, the new approaches will have to look at those new opportunities as well and those rapidly changing forms of disruptive technology and opportunities that are being created in the gig economy.