Aspire Market Guides


India is aspiring to become a $30 trillion economy by 2047 with a per capita income of $18,000 per annum and achieve high-income status. To achieve this, the Labor Force Participation Rate (LFPR) for women needs to increase significantly from the current 27.8% (aged 15 years and above), which starkly contrasts with nations like China (60.5%), the UK (58.2%), and the US (56.8%). Despite India’s youthful demographic, women aged 15-29 have an even lower LFPR of 24.5%, coupled with a concerning unemployment rate of 10.6%. This translates to approximately 16.85 million women out of the 159 million working-age population being without employment.

As highlighted by the World Economic Forum, when millions of women and girls lose out on economic access and opportunity, it has “wide-ranging consequences” for the economy. The relationship between women’s labour force participation and broader economic and social development is intricate, influencing and being influenced by factors such as economic activities, societal norms, education levels, and fertility rates. A simplistic view of the overall LFPR fails to capture the quality of women’s employment, often sidelining critical aspects of their work. Globally, there is a U-shaped relationship between women’s labour force participation and a country’s economic development. In poorer countries, women are highly engaged in subsistence activities, but in middle-income nations, participation declines as men transition to industrial jobs. This structural shift in economic activity and evolving household dynamics influences attitudes toward women working outside the home.

Out of the 159 million working women in India, 65.3% are self-employed, 15.9% earn regular wages/salaries, and 18.8% are categorised as casual labourers or the blue collar segment. While the dominance of self-employment among women reflects entrepreneurial spirit, it also presents many challenges. A large portion of these women operate within the informal economy, often outside the tax net, leading to an inequitable tax burden, weakened social contracts, governance challenges, and long-term economic instability.

Underlying causes

Education: STEM occupations, known for being well-paid and growing in importance, remain male-dominated. Even though more women are entering STEM fields, retention remains an issue, particularly in high-level leadership roles. Female representation in AI, though showing modest growth, still reflects marked underrepresentation, with only a small increase in participation over recent years.

Unpaid work: A 2024 study by the Indian Institute for Population Sciences (IIPS) and Tata Institute of Social Sciences (TISS) highlighted the stark disparity in unpaid domestic work, with women spending 301 minutes per day compared to men’s 98 minutes. Women perform 75% of the world’s unpaid work, essential for household functioning but unrecognised in GDP calculations. Redistributing this work through improved infrastructure, public services, or more equitable sharing among household members would enhance female labour force participation, increase paid work hours for women, and enable them to take on more demanding roles.● Gender parity: The state of gender parity in the labour market remains critical, with striking economic disparities between men and women persisting. This often forces families to prioritise home or childcare over low-paying work for women, excluding them from the workforce. Among women graduates, the Labour Force Participation Rate (LFPR) is 35.4%, but this group faces a notable unemployment rate of 20.6%. Many of these women may be leaving the workforce due to marriage, but their re-entry may often be discouraged by the disparities at work.The potential of focused efforts Governments play a crucial role in addressing these challenges. Removing legal barriers that prevent women from entering the workforce and ensuring access to gender-friendly services such as safe transportation, sanitation facilities for girls in schools, and specialised courts for gender-based violence are essential steps. Policies can be crafted to boost women’s labour force participation, increase wages, improve access to finance and technology, and enhance representation in public-sector leadership. In India, the government has implemented several initiatives to support women’s economic participation. For instance, the Pradhan Mantri Mudra Yojana, which has benefited women by sanctioning 69% of the total 44.46 crore loans to them.

The Beti Bachao Beti Padhao campaign continues to increase awareness and sensitise the masses on gender equality. The Mahila e-Haat initiative has provided an online platform for women entrepreneurs, benefiting thousands of women across India by facilitating the sale of their products and services. This year’s Union Budget emphasised enhancing women’s workforce participation by partnering with industry to establish working women hostels and creches, organising women-focused skilling programs, and promoting market access for women-led SHG enterprises.

What actions can companies take?
Companies have a gigantic role in driving change. By investing in women’s skills through vocational training, companies can directly influence gender parity. Collective and coordinated action by both private and public sectors is essential to achieving gender parity and driving sustainable economic growth. Companies can also transform organisational culture by promoting inclusivity in innovation processes, improving access to affordable childcare, and supporting better parental leave policies. These initiatives not only empower women but also contribute to broader economic resilience and growth.

A silver lining
The pandemic accelerated the adoption of remote work (WFH) and work-from-anywhere (WFA) models, creating new opportunities for women to re-enter the workforce. According to a report by the ILO, the participation of women in the Indian workforce increased by 3.5% in 2021, largely due to flexible work arrangements. This trend is particularly evident in sectors like IT, finance, and education, where WFH models have become more prevalent.

In India, the demand for women in manufacturing is growing, particularly in sectors like electronics, textiles, and automotive. Historically, manufacturing jobs required physical strength, limiting opportunities for women. However, the rise of automation and machine- assisted tasks has levelled the playing field, allowing women to contribute more effectively to the industry. Their inherent dexterity and attention to detail make them well-suited for roles in precision manufacturing, quality control, and assembly processes. The automotive industry alone has seen a 30% increase in female participation in the past decade. Initiatives like the National Apprenticeship Promotion Scheme (NAPS) have also encouraged more women to join technical and vocational training programs, further increasing their representation in manufacturing roles.

Gender diversity in the workplace is not merely a moral imperative but also an economic necessity. Companies with higher gender diversity are more likely to innovate, as cognitive diversity resulting from balanced gender representation enhances creativity and drives superior business outcomes. Metaphors such as ‘glass ceiling’, ‘labyrinth of leadership,’ and ‘sticky floor’ have long illustrated the obstacles to women’s advancement in the workplace. However, for many companies, investment in gender diversity started years ago, and this ongoing commitment is now generating a positive feedback loop.



Source link

Leave a Reply

Your email address will not be published. Required fields are marked *