TOPIC: THE NOBEL PRIZE FOR ECONOMICS, 2023

THE CONTEXT: Recently, the Nobel Prize in Economics for 2023 has been awarded to Claudia Goldin, for her comprehensive research on women’s contribution to the labour market. This article analyses the significance of the research, its implications and the issues faced by women in the labour market from the UPSC PERSPECTIVE.

BRIEF DESCRIPTION OF THE NOBEL PRIZE IN ECONOMICS, 2023

• The Nobel prize has been awarded for the research that has advanced the understanding of the gender gap in the labour market. It has provided “the first comprehensive account of women’s earnings and labour market participation through the centuries.
• The work has challenged the belief that women’s labour force participation always increased with economic growth. The work looked at the historical data spanning 200 years and found that women’s involvement in economic activities varied.
• It is revealed that there is a U-shaped curve in female labour force participation over time, influenced by structural changes and evolving social norms.
• The reason was change in the education of females relative to males as educational resource constraints. Before industrialisation, more women worked in agriculture and cottage industries. With industrialisation, work shifted to factories, limiting women’s opportunities to work outside their homes.

• Research also explores the reasons behind the gender wage gap using data concerning the last 200 years. It reveals the causes of change, as well as the main sources of the remaining gender gap. While the research focused on the US, the findings are applicable to many other countries.
• According to research, women are vastly underrepresented in the global labour market and demonstrated the gender differences in employment rates and earnings despite modernisation, economic growth and rising proportions of employed women in the twentieth century.

AN OVERVIEW OF INDIAN SOCIO-ECONOMIC SCENARIO

• Since Independence in 1947, India took long steps towards the progress of the nation. The concerted and coordinated efforts of governments through various Five Year Plans have changed the economic scenario of the country considerably.
• Agriculture production has risen steadily, and progress of industrialization has increasingly played a role in India’s economic development.
• Various factors, such as the level of literacy, female education, nutritional standards, and income distribution, contribute to the striking variations among regions and people.
• Despite the development, it is the gender bias that still exists at every social strata, even in the most educated and developed society.
• Currently, the participation of women in the workforce in India is one of the lowest globally. The labour force participation rate (LFPR) among women with secondary education or higher was 29.2%, less than half that of their male peers (73.1%), as per the Periodic Labour Force Survey (PLFS) report for 2022-23.
• Most women in India are engaged in subsistence-level work in agriculture in rural areas and in low-paying jobs such as domestic service and petty home-based manufacturing in urban areas.

WOMEN’S ROLE IN AGRARIAN AND INDUSTRIAL SECTOR IN INDIA

WOMEN IN AGRICULTURE

• The agriculture sector employs 80% of all economically active women and they comprise 33% of the agricultural labour force and 48% of self-employed farmers.
• The Indian Council of Agricultural Research (ICAR) research revealed that the participation of women is 75% in the production of major crops, 79% in horticulture, 51% in post-harvest work and 95% in animal husbandry and fisheries.
• The All India Report of Agriculture Census (2015-16) shows that the total number of operational holdings in the country increased from 138.35 million in 2010-11 to 146.45 million in 2015-16, showing an increase of 5.86 per cent.
• Male operational holdings (excluding institutional) constituted 86.0 per cent while female holdings were 14.0 per cent in 2015-16 against 87.2 per cent and 12.8 per cent respectively in 2010-11. This data indicates the rising participation of females in the management and/or operation of agricultural holdings in the country.

WOMEN IN INDUSTRIES

• Data from the Annual Survey of Industries (ASI) shows, of the 8 million workers employed in India’s formal manufacturing industries in 2019-20, 1.6 million (19.7%) were women and this share has remained largely unchanged for over two decades.
• Among the five most industrialised states, the picture is mixed  with Maharashtra (12%), Uttar Pradesh (5.7%) and Gujarat (6.8%) having large gender gaps and Tamil Nadu (40.4 %) and Andhra Pradesh (30.2%) faring much better. Women’s share among industrial employees was less than 10% in 16 states and Union territories.
• Apart from that, Women workers are concentrated in a handful of industries. An industry-wide analysis of female employment from ASI 2019-20 shows a skewed gender workforce across most industries.
• There are also highest gender wage gaps across sectors in the country. Much of this wage gap is unexplained by gender-specific differences in education, occupation, or age/marital profiles, pointing to potential discrimination.

WOMEN IN INDIA’S SERVICES SECTOR

• In the early 20th century, the growth of the services sector played a pivotal role in women’s access to higher education and employment opportunities. This sector offered more opportunities for women to enter the workforce.
• Overall, data suggest that access to higher education increases mobility and widens the scope for economic opportunity, leading to jobs and financial empowerment for women.
• The IT sector is considered the largest employer of the country’s white-collar workforce and has the highest representation of women in the workforce.
• The Indian IT sector has witnessed a significant increase in the number of women employees over the past decade. Currently, over 20 lakh women are employed in the sector, accounting for 36% of the total workforce.
• This growth can be attributed to various factors such as progressive policies, increased availability of computer science courses, visible examples of women in leadership roles, and policy frameworks enabling women to work night shifts.

ISSUES FOR WOMEN WORKFORCE IN INDIA

MARITAL AND SOCIETAL CONSTRAINTS IN INDIA

• The Nobel prize research work found that by the beginning of the 20th century, while around 20 per cent of women were gainfully employed, the share of married women was only five per cent.
• The research noted that legislation known as “marriage bars” often prevented married women from continuing their employment as teachers or office workers.
• Another issue is of societal expectation based that doesnot expect women to take a long, uninterrupted, and fruitful career and have a career as long as the independence of women does not threaten the existing socio-moral order.
• As per a report by NFHS, only 32% of married women are employed in India right now and around 15 per cent of the women who are working are not paid at all. (This percentage for men is just 4 percent.)

TRADITIONAL ROLES VS. MODERN ASPIRATIONS

• The research noted that a female’s educational choices, which are made at a relatively young age, are influenced by the experiences of females of previous generations.
• Traditionally, it has been observed that women tend to have lower career aspirations as compared to men in regards to professional careers in view of their traditional gender role attitudes that attached the role of earning livelihood solely to the men in the house.
• Women, hence, are allowed to be modern only until their idea of modernity is limited to ‘looking modern’. Herein comes the idea of “a modern woman rooted in tradition”. This “superwoman” character is a working professional who manages to take care of the household as well as look after her children, all by herself. They are under the constant pressure to strike a balance between households and career.

GENDER-SPECIFIC JOB ROLES

• There is a general consensus in managerial and sociological research that certain occupations are gendered. For example, public relations, nursing, and teaching are considered “female-gendered” occupations, whereas stock trading, engineering, and construction are considered “male-gendered” occupations.
• STEM fields are often viewed as masculine, and teachers and parents often underestimate girl’s abilities in STEM starting as early as preschool.
• Gender roles and the pressures to conform to these roles for women vary across regions, religions and households.

PARENTHOOD AND GENDER PAY GAP IN INDIA

• The research compares the income and wage trajectories of women to those of their male partners before and after parenthood.
• As women had to shoulder more of the parenting responsibilities, they were punished for this at the work front in terms of a slower rise on the pay scale.
• While historically, the earnings difference between men and women could be blamed on educational choices made at a young age and career choices, the research found that the current earnings gap was now largely due to the impact of having children.
• For working mothers, societal expectations continue to define their expected roles and responsibilities, making it challenging to navigate the demands of career and family life. Many women find themselves torn between fulfilling their professional aspirations and meeting social ideals of motherhood.
• There are issues of insufficient Maternity Leave during child-rearing years, the unemployment penalty for women is longer. This means that when women take longer leaves, they have a much harder time getting rehired.

GOVERNMENT INITIATIVES FOR WOMEN LABOUR FORCE PARTICIPATION

In India, the government has come up with several initiatives for improving opportunities for women workforce. Some of them are mentioned below:

• Article 39 of our constitution directs that States shall, in particular, have policies towards securing equal pay for equal work for both men and women.
• Acts for equal wages: The Equal Remuneration Act, 1976 provides for payment of equal remuneration to men and women workers for same work or work of similar nature without any discrimination. Further, under the provisions of the Minimum Wages Act, 1948, the wages fixed by the appropriate Government are equally applicable to both male and female workers and the Act does not discriminate on the basis of gender.
• Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013: The POSH Act is a legislation enacted in 2013 to address the issue of sexual harassment faced by women in the workplace. The Act aims to create a safe and conducive work environment for women and provide protection against sexual harassment.
• Maternity Benefit (Amendment) Act, 2017: It provides for enhancement in paid maternity leave from 12 weeks to 26 weeks and provisions for mandatory crèche facility in the establishments having 50 or more employees.
• The Factories Act, 1948: The Factories Act is a legislation to secure to the workers employed in a factory, health, safety, welfare, proper working hours, leave and other benefits. The Factories Act also has exclusive provisions for women workers.
• Mission Shakti: It is an integrated women empowerment programme launched as an umbrella scheme for the safety, security and empowerment of women to increase their participation in workforce. It has included the existing schemes of National Creche Scheme for children of working mothers and Beti Bachao Beti Padhao (BBBP) for holistic development of women.

Further, in order to enhance the employability of female workers, the Government is providing training to them through a network of Women Industrial Training institutes, National Vocational Training Institutes and Regional Vocational Training Institutes. A number of protective provisions have been incorporated in various labour laws for creating congenial work environment for women workers.

THE WAY FORWARD

• Reforms in laws: There is need for legal reforms affecting women’s pay, laws affecting women’s work after having children, constraints on women starting and running a business, gender differences in property and inheritance. It’s necessary to improve legal equality for keeping the rights of women workforce intact. Major regulations for equal remuneration for work of equal value, allowing women to work at night and in an industrial job in the same way as men, etc need to be implemented.
• Family planning: Investments in family planning and women’s reproductive health yield large benefits for women, children, and entire Even the research has highlighted the role of contraceptive pills. Women’s access to sexual and reproductive health and rights (SRHR) often manifests in higher maternal ages at first birth, lower fertility, and longer birth spacing. This is important for women’s health and the economy, leading to lower costs for health systems as well as increased LFP, educational attainment, and lifetime earnings for women
• Impact of research: The research for which Nobel prize is awarded can be applied in making the Government policies more gender sensitive. It can also be used to design special policies for women employment. As the research has provided significant insights on the status, role and participation of women in the workforce, it provides sufficient data about underlying barriers hindering women employment.
• Global Relevance: Gender inequality in the workplace is not limited to one country but rather, it is a global issue. The Nobel Prize research has implications beyond the United States, as gender disparities exist worldwide. The work contributes to the international dialogue on gender economics and need to address gender gap in labour economy worldwide.
• Gender Equality and Rights: There is a need to enhance women’s ability to participate equally and help to access decent work which promotes meaningful participation in economic decision-making. It can help achieve the 2030 Agenda for Sustainable Development i.e Goal 5: to achieve gender equality, Goal 8: to promote full and productive employment and Goal 10: reducing inequalities.

THE CONCLUSION: Empowering the women in the workforce is not only essential for economic growth but also aligns with global goals of gender equality. Greater gender equality can enhance economic productivity, improve development outcomes for the next generation, and make institutions and policies more representative.

MAINS PRACTICE QUESTIONS

Q.1 Discuss how the recognition by the Nobel committee brings global attention to the issues faced by women in the workforce. How can India leverage this attention and bring about systemic changes to address gender disparities in the workforce?

Q.2 How marriage and parenthood influence women’s career decisions in India? Discuss this in the context of traditional vs modern aspirations. Suggest measures to address the issue.