Since the past decade, the Female Labor Force Participation Rate (FLFPR) has declined in India. As per International Labor Organization (ILO) estimates, the FLFPR has dropped more than 10%. Recent studies estimate that gender equality in labor participation rates would positively impact GDP growth. Despite increasing female employment being a key component to economic growth, why is it dropping in India?
One explanation that researchers have attributed consistently, relates to social norms around gender in India. The Social Institutions and Gender Index (SIGI) studies gender inequality based on four major categories: discrimination in the family, restricted physical integrity, restricted access to productive and financial resources, and restricted civil liberties. India stands at a medium on the gender discrimination scale in 2019, with the SIGI value being 34%. The two individual categories above average in discrimination against women are, discrimination in the family and restricted access to productive and financial resources. These two variables cumulatively stem the causes of the significant drop in FLFPR. The factors leading to a consistent reduction in Indian FLFPR are increased female education, increased per capita expenditure of households, and social norms, among others.
The common bridge between all of this is the excess burden of unpaid work on women. The government has taken several initiatives such as increasing the paid maternity leave from 12 weeks to 26 weeks; provisions of creche facilities for establishments having more than 50 or more employees; modifying factories act (1948), permitting women to work in night shifts as well; along with multiple skill development and career service centers. However, some of these measures have done more harm than good. An increase in the maternity break has increased the pre-existing maternal penalty women pay when they choose to start or grow a family. It increases employers’ bias against employing women. The present relationship between female education and employment has a U shape relationship, which implies that as education increases, employment increases, but only until a point beyond which employment decreases as education increases. While this is an unusual phenomenon, this is not rare in nature. Among 71 countries studied in 2018, 14 countries replicated the same curve. The curve follows income and substitution effects, i.e. women command higher wages or earn higher wages for the same amount of work that would encourage them to substitute participation in the labor force for leisure or home work. Further educated women tend to marry educated men with higher incomes, so the higher (unearned) family incomes would further discourage women’s participation in the labor market. However, this factor is claimed to be inadequate to explain the relationship. It is attributed to jobs not matching women’s “aspirations.”
As noted by a study, about 72% of women stated that they preferred part-time jobs. Around 95% of women said they preferred working on a regular basis if they could accept work in their household premises. These numbers indicate that women aspire for part-time jobs from home due to patriarchal societal norms, unpaid work burden, and preference for family care. By enforcing laws and mandates in full time job workplaces we are just catering to a limited population. Hence, the solution is to increase job avenues for women which are part-time and home-based as a quick fix until social norms are modified by raising awareness, developing non-discriminatory accomodative practices while hiring in corporate workplaces, and empowering women in the society to take their financial decisions independently void of any familial pressure. Beyond laws and regulations, social changes can be brought about. The answer lies in appropriate nudges and behavioral interventions.
In a report on improving gender equality, four prime areas of intervention are noted: leadership and accountability, hiring and selection, talent, management, learning and development, and workplace flexibility. Companies must make a public announcement to set internal targets for gender representation and inequality; specific targets rather than broad statements and public commitment ensure responsibility to fulfill the goals. Having a diversity lead is associated with better representation of women and minority groups in organizations, hence companies can appoint diversity leads or task forces devoted towards the cause of inclusion. A significant nudge at this point is offering flexible working by default in job advertisements. Considering international statistics, companies found an average increase of about 19-30% in applications due to this setting. Women are less likely to negotiate their pay leading them to start at lower starting salaries on an average than men. Hence, an effective action would be for employers to clearly state their salary range available and if the salary is negotiable. Employers need to make sure that women are not unfairly penalized when they do negotiate and monitor the outcomes and observe if any gender gaps emerge.
While these solutions can turn out to be effective, there is a necessity to improve social context and reduce the discriminatory practices within households towards women’s employment and their independance. While these can take time, policies can be built to accommodate the social structure. For the said cause, the World Economic Forum (WEF) set up the Gender Parity Task Force (GPT) in 2012. The GPT aims to increase female representation in the labor force, narrow the gender wage gap, raise awareness of the business case for gender parity, and help shift stereotypes. The GPT is active in Spain, Chile, Argentina, among others. In Chile within three years of establishment, the member companies presented 5.6% of wage disparity while the average was about 18%.
To summarize, social norms and contexts have significant implicit impact on workplaces. Behavioral interventions such as representation, positive reinforcement can help prevent bias and encourage female participation in workplaces. Along with these interventions a gender parity task force would help identify loopholes in informal workplaces as well as it forms a large part of the working sector in India. These principles can help build a more economically inclusive society for women.
Ananya Acharya
