As the participation of women in labour force declines in the country, Sher Singh Verick of ILO explains to Archana Mishra the reason behind this trend, the role education plays and the kind of transformation the country is going through vis a vis women labour force.

The participation of women in labour force has declined in India. And we are still not able to find concrete reasons for it. Economists, academicians and sociologists have different opinions. What makes this shrink puzzling?

The decline in female labour force participation rate in India has been one of the puzzling trends for policymakers and academics, though it is, in fact, not unique to India. For example, such a declining trend was witnessed in Turkey during the 1990s and 2000s.

Most studies, including the recently released ‘Transformation of Women at Work in Asia: An Unfinished Development Agenda’, focus on four explanations for the decline: firstly, increased enrolment in secondary schooling; secondly, rising household incomes, which pulled women out of the drudgery of agricultural labour; thirdly, mis-measurement of women’s participation in the labour force; and finally, the lack of employment opportunities for women in the non-farm sector. Based on small-sample primary surveys, there is also some evidence that the mechanisation of agriculture has contributed to the decline in demand for female agricultural labour.

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The bottom line is that, while Indian women have withdrawn from traditional roles in agriculture, there have been insufficient job opportunities for women in fast-growing sectors, which has been the case in other countries in Asia, including Bangladesh. That said women are entering the labour force in larger numbers in some states, such as Tamil Nadu, where the garment industry has become a large employer of women workers.

According to the World Economic Forum, increase in education spending by one percent of GDP in India could boost female labour force participation by two percentage points. To what extent can education really help, especially when educated women prefer to pull out from workforce?

The relationship between female labour force participation and education is complex. Firstly, higher enrolment rates for girls and young women reduce the female labour force by definition (education being classified as out of the labour force).

Secondly, in countries like India, education has a non-linear relationship with the labour force participation of women once they have completed schooling. In particular, there is a U-shaped relationship between female labour force participation and educational attainment, which reveals that poorly educated women’s employment is distress driven, and they are compelled to work to support themselves and their families. In contrast, attractive job opportunities with higher wages induce better-educated women to work and stigmas attached to taking up employment may be lower for these women.

Education only appears to pull Indian women into the labour force once they have at least a secondary education. In 2011-12, the female labour force participation rate for women in urban areas with secondary education was just 12.5 percent (aged 15-59). The rate increased for women with higher secondary to 14.6 percent, while it is the highest for women with tertiary education with participation rate of 33.3 percent.

Based on an econometric analysis of NSS data for 2011-12, a woman with graduate or above education has a 30 percent higher probability of being in regular salaried work in rural areas (compared to illiterate workers) and 20 percent higher probability in case of urban areas.
Therefore, the challenge is to ensure that girls and young women can stay longer in school so they receive more education. Less than 10 years of education is just not enough to ensure that they can access better jobs and decent work.

One cannot ignore that there is a gradual shift from agriculture to non-agriculture practices in rural areas. What is the magnitude of this change?

The unexpected decline in the labour force participation rates of women in India has been largely driven by the withdrawal of women from agricultural employment in rural areas, while rates in urban areas of the country have been largely stagnant over many decades.

From 1999-2000 to 2011-2012, around 14 million women left agriculture, while the number of non-agricultural women workers increased by only 10 million. Thus, the shift to non-farm rural employment is happening but it is still at a nascent stage. In 2011-12, 74.9 percent of women workers in rural areas were still in the agricultural sector. There is a long way to go before enough non-farm jobs are available in rural and peri-urban areas, which women can access given the social and economic constraints they face.

Research shows women want to be regular workers instead of self-employed or casual workers. What kind of transformation is the country going through?

Economic development is typically characterised by a number of transformations: the movement of population from rural to urban areas; the accompanying shift out of agriculture and into manufacturing and then services; and the transition from self-employment into salaried and wage work. These transformations are not happening in India according to the stylised processes witnessed in other countries. For example, while the pace of urbanisation has increased, it will take until 2050 before more than 50 percent of the population is residing in urban areas in India (UN World Urbanization Prospects: The 2014 Revision). However, current efforts to promote sustainable urbanisation, through smart cities and other initiatives will accelerate this trend.

Self-employment remains the norm for most workers in India: in 2011-12, 56.1 percent of women workers were self-employed compared to 50.7 percent men workers. In fact, self-employment has been persistent at these levels for some decades. Regular work is a feature of urban labour markets: in 2011-12, the share of urban women workers in regular employment increased to 42.9 percent from 28.5 percent in 1993-94. Thus, as urbanisation increases, more women will eventually be regularly employed. However, this requires overcoming a number of constraints, including childcare and safe transport.

What are these constraints?

There is considerable uncertainty surrounding the emergence of regular salaried and wage work as the norm in the labour market. New jobs in the organised sector are more often than not informal because they do not provide access to social security and employment benefits. This will continue to act as a disincentive for women to join the labour force. At the same time, new technologies provide opportunities for women to work in growing sectors, including as self-employed. Overall, more quality jobs are needed, which provide equal treatment for women and access to social protection and rights for all workers.

The government scheme Skill India is one of the major initiatives in this direction. But are we creating gender stereotypical job roles?

Skill India is an important initiative of the government. It needs to be built on quality education beyond secondary schooling, which provides women with necessary qualifications to access better jobs available in the labour market. Significant progress is being made in this regard.
The challenge is to ensure that skills acquired are in line with the demand of the labour market, not only now but also in the future. The formation and promotion of sector skill councils in promoting industry involvement in the India skills ecosystem is an important step towards this goal.

Women in India and other countries have long faced occupational segregation in terms of types of jobs women and men can access. Across the world, women crowd into certain jobs which are low in the occupational hierarchy, payment and status, but are considered socially acceptable.

As recognised by the National Skill Development and Entrepreneurship Policy 2015, getting women into non-traditional roles will be a powerful economic step. This goal is a work in progress; more efforts are needed to ensure that this becomes a reality across the country, particularly in the poorer states.

archana@governancenow.com

(The interview appears in the February 1-15, 2017 issue)