How Gender Equality Could Turn Into Growth For India

Following several events that have brought gender gaps in close attention of people all across the world, there has been very little reflection of this reverence and attention in the workplace. Gender gaps are narrowing across different measures and it is harder to ignore the new found motivation and energy that women are approaching the world. However, discrimination might sound like a thing of the past, but it is far from a fair system. Amidst increasing anti-discriminatory policies in companies across the globe and the greater visibility of public speech for gender equality, women continue to be miles behind men in their representation in an economy. There might not be a more relevant or urgent case than India’s to illustrate this incoherence.

 Sexism is unfortunately perverse in India. Yet, upon paying close attention to the trends in demographics in India over the last 10 years, there is evidence of a growing status of women society. There are more women in the Indian government today than ever before and perhaps more importantly, there are many more girls going to school in the country. There has never been a better time to be born a female in India. The stark contrast to this image is that of female participation in the labor force. The adult female labor force participation rate (FLFP) measures the number of women over the age of 15 who are either employed or actively looking for jobs, as a proportion of the female population. In India, it is at a low of 27% (World Bank Data, 2014). India also happens to have the third lowest FLFP among all nations where it is measured. It might be useful to compare this number with China and Brazil, nations with similar economic stature as that of India. China’s FLFP stands at 68% and Brazil’s at 59.4% (World Bank Data, 2014). It is imperative to note however that key cultural differences contribute significantly to the difference in numbers between these nations. The purpose of this article is to illustrate how these differences create the context for India’s strikingly low FLFP and to try to explain it’s implications.

To begin building the Indian context, it is important to separate the rural and the urban. Important factor differences between the two are education, standard of living and number of children. In a rural Indian family, it is expected of the married woman to be housekeepers. Even though per capita incomes are lower in rural India, stronger household norms restrict women to the household work or in some cases assisting in agriculture. Research performed by the International Monetary Fund shows that effects of illiteracy, marriage and children have stronger effects on women’s labor force participation in rural areas than urban areas in India. Rural India of course has less job opportunities for women, in addition however, if the man in the house is earning “enough”, it is usually not expected of women or children to earn an income. In urban areas however, women are more likely to be educated or qualified for jobs, ad are more likely to be part of the labor force, even if the male member is earning enough.

Even though the woman in the house may not be earning, it doesn’t mean they aren’t working. Prevailing over most other large economies, India has a significant unorganized economy sector. The kind that is not measured in the Gross Domestic Product (GDP) of the country. The most prevalent occupation for women in India is to be a housewife. While work for the home might not generate any economic value, it requires real work on the part of many women of this country. This could be interpreted two ways. First, this represents an unusual proportion of women outside the organized sectors of the economy, which could mean a lot of unutilized resources in the economy. By increasing the number of women in the labor force, India could find new ways of fueling long – term growth. It also means an additional source of income for the family, reducing the burden from the typical earning member of the house. Second, this disproportion could be regarded as a shortcoming of the FLFP measure, as it does not take into account that so many women in the country are actually at work most of the time. There is a strong case for a larger proportion of women to go to economic work however, a large portion of these women are already working and creating value for others in their home. Raising children and taking care of their spouses has it’s own benefits and implications on the economy, so what if it can’t be quantified.

 India’s FLFP might have decreased over the last ten years by 7% however research by the International Labour Organization shows that this is partially because there is significant growth in the enrollment of women and girls in schools and higher education centers. Undoubtedly a positive sign for the status of women and the economy, but there are other factors that are making it harder for women to enter the labor force. One of them is increasing competitiveness for jobs with men. Labor markets are getting increasingly competitive and one of the losers of stiffer competition are women who are first generation entrants into the labor force. In addition, there is sluggish growth in jobs which women in India typically take up, which are typically in sales, basic agriculture, elementary services and handicraft manufacturing. There are not enough new jobs being created in these industries to incentivize a large number of women to start looking for work.

 The economic argument is simple, it is extremely important for women, whether or urban or rural, married or unmarried to work. Women in India are well on their way to good education standards and now it’s time to capitalize on the opportunity and create their own place in the Indian economy. The nation is waiting for women to get out of their homes and lead in government, lead in businesses and in communities. It may not be the most equitable system to get them there, but their increased representation in this country is an eventuality. Driving women forward in the economy can cause key structural reforms in Indian labor markets where increased competition could drive up the level of expertise and skills among citizens to secure increasingly competitive jobs. This in turn spurs specialized industries and can increase income levels, hence creating more robust economic growth.

Even as India achieves nearly 8% annual GDP growth, it comes with a staggering 10% unemployment rate (Bombay Stock Exchange, May 2016). More skilled women entering the labor markets can have it’s unfavorable consequences as well. With a competitive labor market comes unemployment. Perhaps the only thing that can offset it is the growth rate of the economy and sustained private and public investment. In essence a higher FLFP could mean a significantly higher number of citizens competing for the same jobs, which must keep up a growth rate higher than the increase in FLFP. A more competitive job market can and should result in women seeking more skilled positions than before, particularly as their education levels are accelerating faster than that of men in India.

To make it all possible of course, India requires a much more flexible labor market. Some rigidities it will have to loosen are those related to closing large gender gaps in wages, working conditions and will have to implement stronger anti-discrimination legislation. Sound labor market information and making it easily accessible to women, particularly in rural areas can change the gender dynamics of market by itself. It is only getting easier for an Indian woman to work and earn her own living, she must keep in mind however that it will only get better and easier for her and her cotemporaries, if the numbers go up.