Thursday, 10 Oct, 2024
By: Niyati Sareen
Image Source: Freepik
There has been a steady growth in the Female Labour Force Participation Rate, with a faster rise among rural females. This increase in the number of rural women joining the workforce not only reflects a socio-economic shift in the country but also contributes to its growth and development.
‘Viksit Bharat’, a vision to develop India completely by 2047, lays its foundation on fostering economic participation among all citizens. In the last 10 years, India has undergone a major shift in its employment sector, with a positive trend contributing to economic growth and development. According to the annual Periodic Labour Force Survey (PLFS), there has been a rise in the Labour Force Participation Rate (LFPR) which is the percentage of the working population in the 15 - 64 age group currently working or seeking employment.
The Union Budget 2024 - 2025, majorly focuses on efforts to further boost employment in the nation with Employment and Skilling standing as its secondary priority. Finance Minister, Nirmala Sitharaman introduced ‘Employment Linked Incentive’ schemes which focus on the recognition of first-time employees and support to employees and employers. Scheme A estimated to benefit 210 lakh youth offers a one-month wage up to ₹15,000 in three instalments for newly employed individuals in formal sectors. Scheme B focuses on the manufacturing sector by incentivizing new employees and employers through EPFO (Employee Provident Fund Organisation) contribution, aiming to assist 30 lakh youth. Scheme C provides employers a reimbursement of ₹3,000 per month for two years towards EPFO contributions for each new employee, encouraging the employment of 50 lakh individuals.
Although the unemployment rate currently stands at 9.2%, a 2.2% increase since May 2024, the LFPR has been growing steadily. In January - March 2024, urban LFPR was found to be 50.2%, a 1.7% increase since January - March 2023. Additionally, there has been a notable increase in the Female Labour Force Participation Rate (FLFPR) for the past six years which has risen by 13.7% jumping from 23.3% in 2017-18 to 37% in 2022-23. This change is being seen more in the rural sector than in the urban sector, where the FLFPR increased from 24.6% in 2017-18 to 41.5% in 2022-23, compared to an increase from 20.4% to 25.4% in the urban sector.
The Economic Survey 2023-24 estimates India’s workforce to be around 56.5 crores in 2022-23, with the agricultural sector employing more than 45% of the total labour force. Agriculture is the primary livelihood in rural areas, contributing over 16% to India’s GDP and employing the highest percentage of women workers, with a FLFP of 62.9%. The migration of men to urban areas in search of better job opportunities is a significant factor contributing to women becoming the primary labour force in agriculture.
There are several reasons for the increase of women joining the workforce, primarily attributed to government initiatives and policies aimed towards women empowerment. These include Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), which provides women with job opportunities in rural areas and the Support to Training and Employment Program for Women (STEP) that train women in skill development and ensure employment opportunities. Availability of microfinance with the introduction of several schemes such as Stand Up India, Mahila e-Haat and Pradhan Mantri MUDRA Yojana has encouraged female entrepreneurship. Moreover, as highlighted in the Budget 2024-25, in order to boost women participation, the government plans to build working women hostels, creches, and skilling programs specifically for women. Along with this, a significant improvement in female literacy rates and educational attainment has better equipped women to enter the workforce. Additionally the rising cost of living has pushed households to rely on dual incomes prompting more women to seek employment to support their families.
Even though gender disparity in employment trends in India are slowly decreasing, there still exists over a 40% gap between male and female LFPR in India with male LFPR currently standing at 78.5%. According to the IMF, bringing India's female labour force participation rate into line with men's may result in a 27% increase in India’s GDP.
