Women Out-of-work: Exploring the Untapped Economic Potential of India’s Women

Women Out-of-work: Exploring the Untapped Economic Potential of India’s Women

Published on :- May 11th, 2022

Women make up 48% of the Indian population, however, their participation in the workforce is limited to 32% of the total workforce. India is the only major economy that has shown a negative trend in female labour force participation since the 1990s. Although women’s participation is strong in the farming and dairy sectors, India's rapid urbanisation has not yet encouraged more women to join the labour force. Additionally, domestic work, undertaken primarily by women, goes unaccounted for as an economic activity, thus prohibiting an accurate estimation of the contribution of women to the economy.

According to estimates by the Centre for Economics and Business Research (CEBR), India is projected to be the world's third-largest world economy after China and the USA by 2030. It is estimated that enabling equal opportunities for women could offer India an increase of $770 billion on its GDP. However, despite policy interventions, the participation of women in the Indian economy is an area with underutilised potential. The Periodic Labour Force Survey (PLFS 2019-20) reveals some concerning data around women’s participation in the labour force. Analysing these trends with the latest Data with Intent series by Sattva, the following sections explore their implications for the Indian economy.

The reasons for women’s under-utilised potential are manifold. The limited participation of women in the economy is an outcome of a vicious cycle of suboptimal conditions that exclude women from education, skill development, employment and public decision-making.

A pro-male gender bias reflects in the lower numbers of women seeking higher education. Of the entire out-of-workforce population, the percentage of men opting for higher education exceeds that of women by a concerning 67 percentage points. In contrast, an overwhelming majority of out-of-workforce women (80%) cite domestic responsibilities as their primary reason for quitting the labour force.

Limited opportunities for education and the burden of domestic duties also reflects the disparity in skill development for paid work and occupational diversity among women. There is a significant skilling gap between genders, with over 90% of all women having received no formal or informal vocational training. Skill training also seems to reflect cultural biases, with considerably more women than men receiving training in childcare and nutrition.

Of all the women in the workforce, over half are self-employed, with a majority of self-employed women involved in the primary sector (agriculture, forestry and fishing). Around a fifth of all women are employed as casual labour, primarily in the construction sector. Not only does this limit earning potential, but also exposes women to a number of risks associated with unregulated workplaces.

Even as a pro-male bias could be expected to prevail in rural India as far as educational and employment opportunities for women are concerned, the wage gap for women in urban areas far exceeds that in rural India, especially among self-employed women.

Broadly speaking, the gap tends to widen as we look at jobs with higher skill requirements, or white-collar jobs, and is relatively higher in manufacturing and trading sectors. This disparity is generally considered to be a fallout of the gender-based discrimination.

The restriction of women to specific sectors and occupations is reflected in the underrepresentation of women in the public sphere, particularly in leadership and decision-making roles. India ranks among the bottom 20 countries in the Global Gender Gap Index 2021 conducted for 156 countries, slipping 28 ranks since the last survey. Women’s representation in the parliament is at a disproportionate 14%, while even fewer women are in ministerial positions. Women lag behind in terms of economic opportunity as well, with barely over 10% of all firms having a female majority ownership.

Such a situation results in skewed policy-making, which does not take gender-specific challenges and entry barriers into account. When cultural, socio-political and economic implications of gender are not factored in, opportunities for women continue to be limited and they are further excluded from the economy.

It is therefore critical for interventions to address the systemic factors that cause these disparities at various levels to solve the larger issue of women’s underrepresentation, and break the cycle that leads to the underutilisation of women’s potential in the economy.

Data with Intent by Sattva is dedicated to delivering you insights that help you think and act in the impact ecosystem. The next Data with Intent series explores the role of digital platforms in enabling last-mile access across sectors, which will be summarised in our upcoming blog post.

For more data analysis and insights on employment/workforce, check out our data assets on India Data Insights (IDI).

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