Relevance: GS-2: Issues relating to the development and management of Social Sector/Services relating to Health, Education, and Human Resources.

Key Phrases: Labour force participation, World Economic Forum, Global Gender Gap Report, Health and Survival, Political Empowerment, Fertility rates, Economic growth/cyclical effects, Literacy levels, Urban population, Economic incentive, women's participation, Work from home, Tax breaks, Maternity Benefit Act, Maternity leave, Industrial training, Vocational training.

Context:

• Labour force participation of Indian women is dropping precariously and urgent policy actions needed to address this.

Labour force participation of Indian women:

• The female labour force participation rate for the productive age group (15–59 years) decreased by 13.9 percent between 2011–12 to 2021–22 and decreased from 33.1 percent to 19.2 percent.
• Female labour force participation rate is higher in rural areas than in urban areas.
• During the COVID period, due to migration of men to rural areas, the workforce of women in rural areas also declined.
• Nearly 70% of working women in India have quit or considered quitting their jobs because they were not offered the right flexible policies after the Covid pandemic.
• India ranks 135 among 146 countries in the Global Gender Gap Index 2022 of the World Economic Forum (WEF).
• The rank in economic participation and opportunity was particularly abysmal with India at 143rd position. This poor performance is largely due to a very low participation of Indian women in the work force.
• India’s condition is much worse than most developing countries in the world.

Reasons behind the dip of women labour force participation:

• According to ILO, “Based on global evidence, some of the most important drivers (for lower participation of women in workforce) include
  • Educational attainment,
  • Fertility rates and the age of marriage,
  • Economic growth/cyclical effects,
  • Urbanisation,
  • Social norms determining the role of women in the public domain continue to affect women labour force.
• There are many reasons, unique to India, which could account for the drop in recent years.
  • Literacy levels among women have been improving over the last few decades. With women aged above 15 increasingly enrolling for higher studies in colleges, their participation in workforce could have dropped.
  • The rising income, especially among the urban population could have removed the economic incentive for women to work. The difficulties in commuting to work in cities bolster such decisions.
  • The country has not created enough jobs and the demand-supply gap in employment opportunities results in women deciding to stay at home.
  • Most Indian women are deeply engaged in running households, which is unpaid work, and does not count as being part of workforce.

Measures to stop women from quitting workforce:

• Women friendly WFH jobs
  • One of the main reasons urban Indian women drop out of work after marriage is due to the difficulty in balancing household responsibilities and paid-work outside. Labour force participation is higher among rural women in India because they can easily get work closer to home and for limited hours.
  • ILO finds that 34 per cent of rural Indian women and 28 per cent of urban women are willing to accept work at home.
  • In this scenario, Work from home could be an option to increase women's participation in workforce.
  • Work from home (WFH) model needs to be used to provide work to women who have dropped out of the workforce.
  • The government can take a lead here by creating jobs especially for women, which can be done in windows of 3 or 4 hours every day from home. Some basic skill training may be required, cost of which has to be borne by the government.
• Tax breaks
  • According to the gender gap report, not only are fewer women employed by companies, they are also paid lower salaries for the same kind of work compared to men and their average income is also lower.
  • This imbalance can be removed by offering a tax incentive, say 2 per cent lower corporate tax rate, for companies in which at least 50 per cent of workforce is made up of women.
  • Tax incentive can be higher for companies following other gender equity practices such as equal opportunities and uniform pay scales.
• Ease onerous laws
  • Many of the laws made by the government to support women in fact work against them.
    • Ex. Employers may be wary of employing younger women who may avail of 26 weeks of paid maternity leave and require the company to set up a crèche for their children, as laid down in the Maternity Benefit Act.
  • In many countries, the social security benefits given by the government cover the payments during maternity leave, partially or completely.
  • If the government steps up to compensate companies for their payouts during maternity leave, more companies may come forward to employ women.
  • Companies can be allowed weighted tax deduction for salaries given during maternity leave.
  • There is a need to review laws to provide more freedom to women to choose work.

Way Forward

• Women’s labour force participation and access to decent work are important and necessary elements of an inclusive and sustainable development process.
• Women continue to face many barriers to enter labour market and to access decent work and disproportionately face a range of multiple challenges relating to access to employment, choice of work, working conditions, employment security, wage parity, discrimination, and balancing the competing burdens of work and family responsibilities.
• In addition, women are heavily represented in the informal economy where their exposure to risk of exploitation is usually greatest and they have the least formal protection.
• Considering these insights, policy makers in India should take a comprehensive approach to improving labour market outcomes for women through improving access to and relevance of education and training programs, skills development, access to childcare, maternity protection, and provision of safe and accessible transport, along with the promotion of a pattern of growth that creates job opportunities.
• A policy framework encouraging and enabling women’s participation should be constructed with active awareness of the “gender-specific” constraints that face most women.

Sources: The Hindu BL

Mains Question:

Q. “Gender equality in the labour market is considered as 'smart' economics for accelerated economic growth and wealth creation”. Discuss and suggest measures to increase the participation of Indian women in the workforce. (250 words).