A mix of social constraints and dearth of employment opportunities has kept women out of the labour market, leading to a huge opportunity cost to the nation

Women in India face enormous challenges for their participation in the economy — in a way that mirrors the many injustices they suffer in the society at large. The labour participation rate of women — that is, the number of women in the labour force as a proportion of the total female population — provides an indicator of some of these challenges. In 2008, the labour participation rate in India was only 33 per cent for females as compared to 81 per cent for males. By way of comparison, it was 68 per cent for females in China. Among Indian States, the female labour participation rate is one of the lowest in Delhi, a region also known for its harsh treatment of women.

The labour force includes not only the employed but also unemployed persons who are actively seeking jobs. In India, substantial numbers of women who are not counted in the labour force are, as described in the official statistics, ‘attending to domestic duties’ in their own households. National Sample Survey reports tell us that, in 2009-10, out of every 1,000 females (all ages) in India’s rural areas, 347 were attending to domestic duties. In the case of urban females, this number was even bigger: 465 per 1000. Compare this to the number of rural and urban men who were attending to domestic duties: only 5 per 1,000 and 4 per 1,000 respectively.

Why is India’s female labour participation rate so low? Part of the answer lies in the methods employed to measure women’s work.

A woman’s work in her own household is not counted as an economic activity, and does not get reported in the national income statistics. This is unlike the case of services by a paid domestic help, which is considered an economic activity and is counted in the national income. As is well known, women’s domestic duties include childbirth, caring for the young and old, cooking, and a range of other activities that are crucial for the upkeep of the family.

However, society undervalues these immense contributions made by women. And, to some extent, official statistics reproduces the prejudices in the society.

In rural areas, women periodically enter and exit from agricultural work. Quite often, women’s participation in agricultural activities as self-employed workers is to supplement the falling incomes of their families during times of agrarian distress. This is what seemed to have happened in India between 1999-2000 and 2004-05. During this five-year period, the growth of agricultural incomes in the country was stagnant, yet the number of self-employed female workers engaged in agriculture and related activities increased by 17 million, possibly indicating ‘distress employment’.

On the other hand, between 2004-05 and 2009-10, the number of self-employed female workers engaged in agriculture and related activities decreased by 19 million in India.

This decline in employment could be attributed to a modest revival in the growth of agricultural incomes and to the positive impact on rural employment and wages created by the MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act). Thus, it appears that in India, during the 2000s, female employment in agriculture was not driven by any real opportunities for income generation, but was part of a last-ditch effort to escape impoverishment.

Urban, Educated Women

In India, social factors play a significant role in reducing women’s labour participation. Husbands and in-laws often discourage women from working, while, in many parts of the country, restrictions are imposed even on their movements outside the household.

In this context, it is notable that labour participation is particularly low in India among urban, educated women — the section of the female society that is, in fact, less likely to be constrained by social factors. In 2009-10, the proportion of those attending to domestic duties (and therefore out of the labour force) was 57 per cent among urban females with graduate degrees or higher, compared to just 31 per cent among rural females with primary or middle school education.

What are the reasons for such a massive withdrawal of educated women from the work force? Lower wages than men could be one reason. But then female-male wage disparities exist in Japan and South Korea as well, but female labour participation has been high in these countries.

It appears that the factor that pushes female labour participation in India to particularly low depths is the sheer absence of suitable employment opportunities. The slow generation of employment is, in turn, linked to a specific feature of India’s economic transition. This is the relatively small contribution made by the manufacturing sector to India’s GDP (gross domestic product) and employment.

Within Indian manufacturing, women’s employment is increasingly in the low-paid, vulnerable sectors. Between 1999-2000 and 2004-05, women accounted for 3.7 million of the 9.7 million new manufacturing jobs created in the country. A large proportion of these women were employed in the export-oriented sectors such as garment-making.

However, by 2009-10, India’s manufacturing sector was suffering from a variety of problems, including power shortage and a slowdown in export demand from western countries. Between 2004-05 and 2009-10, 3.7 million manufacturing jobs were lost in the country, and more than 80 per cent of those who lost their jobs were women.

During the post-1990 years, the major source of employment for women has been in the services sector, mainly in low-paid services such as domestic help. At the same time, females accounted for only a small share of the relatively high quality jobs generated in India in recent years: for instance, only 20 per cent of the new jobs created in financing, real estate and business services during the 2000s, and 10 per cent of the new jobs generated in computer and related activities during the second half of the 2000s.

Amartya Sen has written about the ‘missing women’ in India, highlighting the low female-male ratio in the country’s population. Sen argues that this issue points to the severe disadvantages faced by the female child in India. The issue of the missing women in India’s population has a parallel in the problem relating to the missing women in India’s workforce. That is, the staggering numbers of women who have withdrawn from the labour force and attend to domestic duties.

In 2009-10, the total number of women attending to domestic duties in India was 216 million, which was larger than the entire population of Brazil. Of these, women with graduate degrees or higher numbered 12.7 million, which was more than twice the population of Singapore. Clearly, the large-scale withdrawal of women from the labour force involves enormous wastage of talent and causes a huge opportunity cost to the nation.

Creating more jobs and ensuring better working conditions for women will encourage greater female participation in the economy.

As more women join the workforce, the voices against gender-based inequalities will grow louder. Equally importantly, there will also be more hands and brains to take the Indian economy forward.

(Jayan Jose Thomas teaches Economics at the Indian Institute of Technology Delhi.)

This article has been corrected for a factual error.