August 13, 2015
by Sirisha C. Naidu
[Source : Triple Crisis]
Between 2005 and 2012, nearly 25
million women—roughly the total population of Australia—withdrew
from the Indian wage-labor market. Imagine the frenzied reaction of
news media, researchers, and policymakers if the entire population of
Australia pulled out of the labor market in less than a decade! This
decline in Indian women’s labor force participation rate—which
counts women who are employed in regular or casual wage work,
self-employed or working in family-owned businesses, plus those who
are seeking work, as a percentage of all working-age women—is part
of a longer-term trend. The labor force participation rate for rural
women declined from 42.5% in 1988 to 18% in 2012, and for urban women
from 24.5% to 13.4% over the same span.
Development scholars and policymakers
often assume that economic growth is a panacea that will unshackle
women from the confines of the domestic sphere, increase their social
status, and allow them to participate in economic and political
decision-making as equals. It is puzzling, then, that the decline in
the women’s participation in the labor market has continued into
the current period during which India has experienced robust economic
growth—the World Bank expects India to overtake China as the
world’s fastest-growing economy by 2017.
The most common understanding of
women’s labor force participation rate is that it is a “U-shaped”
curve—high for countries with very low or very high levels of
development, and low for countries at middling levels of development.
At low levels of economic development, countries are more likely to
be labor-intensive agrarian economies using low levels of technology
and high inputs of female labor. Poverty compels women to contribute
to household income. These factors lead to a high participation rate.
As countries begin to develop and achieve moderate levels of
development, they make the transition from agricultural to industrial
production. Agriculture begins to employ more “advanced”
technology, which reduces the demand for labor, particularly women’s
labor. Meanwhile, the increase in non-agricultural jobs increases
household incomes and reduces the need for women to participate in
the labor market. (Economists call this the “income effect.”) The
overall impact of the demand and supply factors is a lower proportion
of women in the labor force. Finally, as these countries continue to
develop, there is increased demand for highly skilled labor which, as
women secure higher levels of education, they are able to fulfill.
The net result is an increase in women’s participation in the labor
force once again.
Applying this hypothesis to India, some
researchers argue that the declining proportion of women in the
Indian labor force is no cause for alarm. Rather, it is just a
reflection of the downward portion of the U-shaped relationship.
Women, according to this argument, can afford the luxury of not
working for pay due to higher household income. Indeed, India has
some of the trappings of a middle-development country. Per capita
income has increased from about $1,100 in 1990 to over $5,000 in
2012. Meanwhile, the contribution of the agricultural sector to GDP
has declined from 29% to 18%, as the economy transitions toward
higher-value sectors. To test the plausibility of the assertion that
“there is no cause for alarm,” let’s explore some features
associated with the demand and supply of women’s labor in India.
We start with the demand-side. Even
though agriculture’s contribution to GDP has declined, it still
accounted for 47% of total employment in India by 2012. The rural
female labor force, which almost four times the size of the urban
female labor force, derived 75% of its total employment from
agriculture. Therefore, the sectors that create jobs for women are
suffering from low growth in a period of overall high economic
growth. Between 2005 and 2010, women workers suffered a net loss of
21.5 million agricultural and 3.1 million manufacturing jobs;
meanwhile, more than 80% of the 22.3 million non-agricultural jobs
created in this period went to male workers. The decline in
agricultural employment, while perhaps desirable in the process of
economic development, has not been sufficiently compensated by an
increase in jobs in other sectors. The biggest losers of this phase
of “jobless economic growth” in India have been women workers.
A second undesirable trend in the
process of Indian economic development is that there is a far greater
demand for contingent or informal workers than regular workers.
Informal employment is contractual or insecure in nature and,
according to a recent report from the Indian government, is
characterized by lower wages, little or no benefits, lower job
security, and higher instances of sexual harassment, compared to
regular employment. Thus, along with jobless growth, women workers
have to contend with poor quality, insecure jobs with a higher risk
of harassment. These, along with some other factors, suggest that
conditions on the demand side of the labor market are very
undesirable for women workers.
Now let’s look at the supply side. As
stated earlier, according the “U-shaped” explanation, women
reduce their labor market participation because of the income effect.
While Indian per capita income has indeed increased, it has been
accompanied by lower overall calorie consumption and poorer
nutrition. It is thus possible, as research by economists Amit Basole
and Deepankar Basu suggests, that despite higher incomes, many Indian
households are suffering from increased expenditures on other
essentials such as education and health, thus leading to a
food-budget squeeze. Further, there is evidence of increased income
inequality, which indicates that the benefits of economic development
have not been widely shared. The latest data released by the Indian
government’s Socio Economic and Caste Census reveals that 75% of
Indian households live on less than 5,000 rupees ($78.74) per month.
Thus, it seems overly optimistic to claim that women, especially in
the poorest households, are withdrawing from the labor market due to
higher household incomes.
Women’s reduced participation in the
labor force coincides with an increase in working-age women’s
participation in “domestic and other allied activities.” These
consist of production for household consumption—such as processing
one’s own food or caring for animals that produce milk and meat for
the household. It also includes cooking, cleaning, and caring for
one’s own family. These activities increase the consumption of
total goods and services by the household, but do not show up in
official GDP or labor-force statistics because they do not pass
through the market. Under the current system, if the very same work
performed for the family is offered in the market, it increases GDP
without actually increasing the value of goods and services in the
economy. At the household level, if a family member earns just enough
to purchase goods and services that she was previously producing for
household consumption, she would add to household income but not
household consumption. As feminist economists have argued, the
exclusion of domestic and other allied work from the calculation of
labor force participation rate underestimates the economically active
population.
Indian women’s increased
participation in household production—at a time of high poverty and
inequality, and low demand for women’s labor—fails to square with
the argument that women’s labor force has declined due to the
income effect. Rather, it suggests that women and their households
are scrambling to ensure a minimum level of consumption for survival.
Withdrawal from the labor market does not allow women to engage in
leisure activities; it has instead pushed them back into the
undervalued and invisible domestic sphere. This condition is
exacerbated by the Indian government’s dismal role in providing
essentials such as education, healthcare, and well-paying decent
jobs.
Thus, it is imperative that the Indian
government take the following steps that dovetail with higher
economic development.
- Include domestic and other allied activities in the calculation of women’s labor force participation rate so that adequate policies can be formulated.
- Direct economic growth toward employment-generating sectors so that women workers can secure jobs.
- Regulate the labor market to ensure a living wage and better working conditions
- Provide basic services essential for survival and a healthy workforce, and free women from the drudgery of housework.
- Pass and enforce laws against gender discrimination in the workplace and enforce existing laws against sexual harassment.
Such intervention is necessary for two
reasons. First, countries in North America and Western Europe that
experienced an upturn in women’s labor force participation, after
an initial decline, often put in place deliberate policy
measures—such as implementing anti-discrimination laws and
investing in public education. Second, these countries faced
different global economic conditions at the same stage of development
as India presently. In today’s economic environment, in which
public sector jobs have declined, workers increasingly depend on
employment in the private sector, which can relocate to almost any
part of the world. This threatens workers’ ability to negotiate
higher wages, better working conditions, and a higher standard of
living. It also reduces the promise of higher investment and jobs in
the domestic economy by high-performing businesses. All of this
negatively affects women’s participation in the labor market.
Rather than accepting the decline in women’s participation rate as
a necessary but temporary fallout of the development process, it is
essential that the Indian government take corrective measures, so the
Indian economy can fully employ its vast working age population, both
male and female.
Sources:
1) Abraham, V. (2013) ‘Missing labour
or consistent “de-feminisation”?’ Economic and Political Weekly
48(31): 99-108.
2) Basu, D., & Basole, A. (2013)
‘The calorie consumption puzzle in India: an empirical
investigation’,
PERI Working Paper Series No. 285. Amherst: University of Massachusetts Amherst.
PERI Working Paper Series No. 285. Amherst: University of Massachusetts Amherst.
3) Mazumdar, I. & I. Agnihotri
(2011) ‘Gender dimensions: employment trends in India, 1993-94 to
2009-10’. Occasional Paper No. 56. New Delhi: Centre for Women’s
Development Studies.
4) MRD (2015) Socioeconomic and Caste
Census 2011. Ministry of Rural Development. New Delhi: Government of
India.
5) NCEUS (2009) The Challenge of
Employment in India: An Informal Economy Perspective Volume I. New
Delhi: National Commission for Enterprises in the Unorganised Sector.
6) NSSO (2014a) Employment and
Unemployment Situation in India. 68th Round July 2011-June 2012.
Ministry of Statistics and Programme Implementation. New Delhi:
Government of India.
7) NSSO (2014b) Participation of Women
in Specified Activities along with Domestic Duties. 68th Round July
2011-June 2012. Ministry of Statistics and Programme Implementation.
New Delhi: Government of India.
Thomas, J. J. (2012) ‘India’s
labour market during the 2000s: Surveying the Changes’, Economic &
Political Weekly 48(51): 39-51.
Thomas, J.J. (2014) ‘The Demographic
challenge and employment growth in India’ Economic and Political
Weekly 49(6): 15-7.
The World Bank (2014) World Development
Indicators. Retrieved from http://data.worldbank.org
- See more at:
http://sanhati.com/articles/14230/#sthash.HiESPeAb.dpuf
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