MARCH

2019

India's Missing
Demographic
Dividend
A report on the falling economic participation of Indian
women and its impact
 YOURSTORY RESEARCH

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2
 CONTENTS
LOCKED OUT OF JOB MARKETS: INDIA'S MISSING DEMOGRAPHIC
DIVIDEND

4-5 INTRODUCTION

6-10 WOMEN IN WORKFORCE

- State of female LFPR: India vs the rest of the world
- Busting myths and misconceptions

11-13 SIZING UP A LOST OPPORTUNITY

- Female labour force participation rate in India
- Impact of a lower LFPR on GDP

14-18 FEMALE LFPR IN AGRARIAN VS INDUSTRIAL ECONOMIES

- Understanding the U-Curve
- India and the U-Curve

FACTORS IMPACTING LFPR

20-30 - Economic growth composition, job opportunities
- Cultural norms
- Poor public safety and transport, lack of credit

31-32
THE ROAD TO HIGHER LFPR

3
 INTRODUCTION
A senior advisor to the Chinese India has all these advantages,
Communist Party made an specifically so with the lately
interesting point during a session accelerated rate of highway
on International Relations at a construction and the introduction
Shanghai business school last year. of a unified GST. However, Chinese
and Western assumptions about
India’s inevitable rise have to be
According to him, “India’s greatest taken with a pinch of salt, even
achievement over the last 70 years though the country is likely to
has been to contain ethnic, remain home to the world’s largest
linguistic, and religious diversity population of youth, at least until
within a single national border. the mid-2040s.
That is why when we talk of
promising markets of the future, To be clear, strength of institutions,
we think first about India – with its state support to innovation, and
670 million young people – before above all, the investment in skills to
we think of Africa and the Middle equip the youth for the jobs of the
East, which have a similar future are imperatives without
demographic dividend and yet, are which the demographic dividend
not the same polity”. just becomes an easy and potent
fuel for social conflicts.
Being a single polity is a big deal,
when it comes to being able to
capitalise on your demographic
dividend. It implies free movement The falling economic
of goods, people, technology, and participation of women
capital within the polity. It allows remains a red mark on
for largely similar business India’s otherwise laudable
regulations and tax regimes. And economic reform report
finally, it provides mechanisms for card for the past 20 years.
fiscal and monetary support if the
business cycle in one region dips
relative to another.

4
 INTRODUCTION
As we move closer to the General But what if we told you that
Elections, India’s demography has despite this challenge, the
increasingly begun to be portrayed governments of the future may not
as a Malthusian challenge, instead have to create 10 million new jobs
of an immense economic each year? What if a significant
opportunity. The ominous statistic portion of such youth will never
often cited to highlight this aspect protest on the streets, rather that
is that approximately 10 million they will not even actively seek
people are added to the nation’s jobs? And what if we told you that
workforce; this is likely to continue even their absence from the job
till 2030.  Jobs will have to be market is not an optimistic
created for them. scenario? That, we stand to lose a
lot, even in such an eventuality.
And all measures of employment
creation in the economy This report is a preliminary attempt
throughout this decade, to quantify India’s lost
howsoever politically biased they demographic dividend; of the lost
are towards or against the current potential of millions of women
government, show that actual jobs who are simply shut out of the job
created have fallen well below this market, and; the impact this could
magic number. have on our economic and social
well-being.
This development, which has
already been underway since 2010,
has been attributed as the reason Approximately 77 percent
behind the frequent agitations for of working age women in
caste-based reservations (in a
the world’s second-most
rather less socially segmented
populous country remain
Indian society compared to the
locked out of the labour
time of independence) and the
markets.
rising support for farm loan
waivers.

5
 WOMEN IN WORKFORCE
STATE OF FEMALE PARTICIPATION IN LABOUR FORCE: INDIA VS THE
REST OF THE WORLD

At the outset, it is important to benchmark India against other

countries, when determining our ability to provide economic
opportunities for women. With regard to female labour force
participation rate (LFPR), how does India fare when compared with
other countries?

As Figure 1 shows, India’s performance in ensuring a fair and equal

participation of women in the labour force has been abysmal.  This is
quite unlike other indicators of economic performance such as Ease
of Doing Business and Global Competitiveness Index, where India has
notched up strong gains in the last five years.  We cannot argue that
India remains behind the G-8 countries on the LFPR metric because
it is in an earlier stage of economic and social development.

However, India also lags significantly behind countries in the same

stage of economic development (EM-8) and those with which it
shares a lot of cultural and social similarity (South Asia). At 23.4
percent as of 2012 (National Sample Survey), India’s female labour
force participation (LFPR) trailed that of South Asia (41.6 percent), the
Emerging Markets (52.2%), and the G-8 (58.2 percent) by quite a
distance. World Bank Development Indicator data in 2017 showed
India’s LFPR improved to 27 percent, yet the gap with global peers
remains significantly wide.

6
 IF INDIAN WOMEN PARTICIPATED IN THE LABOUR MARKET AT
THE SAME RATE AS OTHER EMERGING MARKETS, INDIA’S LABOUR
FORCE WOULD HAVE BEEN BIGGER BY A NUMBER EQUIVALENT
TO THE SIZE OF JAPAN’S POPULATION. THE ECONOMY LOSES
APPROXIMATELY BETWEEN USD1.4-2.8 TRILLION

Figure 1: India’s female LFPR significantly lags other country groups,

including those which are culturally and economically similar to it

Source: ILO

8
 The fact that approximately 77 percent of working age women in the
world’s second-most populous country remain locked out of the labour
markets implies a wastage of human resources, not just on a national
level, but also on a global scale.

To quantify this point better, if India’s female LFPR was similar to that of
South Asia today, we would have had 78 million more workers
(equivalent to the population of Germany); if we were to match the LFPR
of the Emerging Markets (China, Russia, Mexico, South Africa), we would
have had an addition of workers equivalent to the size of Japan; and if
India had a female LFPR similar to that of G-8, that would have meant
150 million more workers today.

Figure 2: Indian women are better represented than the other

emerging markets when it comes to CEO and Board members in
corporate sector; however, their share in mid-management roles is
disappointing, pushing back India’s ranking on this measure

Source: ILO, Governance Metrics International

9
 BUSTING MYTHS &
MISCONCEPTIONS
Before we proceed further in our analysis, it is imperative that we clarify a
common misconception about labour markets that prevails in
economies that have been ruled for decades by a socialist and welfare-
doling government.

In a survey undertaken by Pew of people from both genders, 84 percent

of the respondents believed that there is a limited number of jobs
available in the economy, and that women should not take them away
from men, whose main task is to financially support the family. This
attitude assumes that jobs are created from above – either in the public
sector or by big industrial houses and MNCs looking to expand business.
This mentality also implicitly assumes that 150 million women locked up
in their houses could pose a threat to the already scarce jobs in the
economy, rather than creating more of them.

Evidence from around the world runs counter to this assumption. A

cross-section of case studies from the globe have shown that women’s
participation in the workforce went hand-in-hand with greater total
employment and greater overall prosperity.

Indeed, in countries like Italy, Brazil, Mexico, Indonesia, and South Africa,
which saw an explosion in women’s economic participation in the final
years of the 20th century, women played a key role in either expanding
the SME sector, or were job creators themselves. In particular, sectors like
retail, healthcare, teaching, food and beverage, and low and medium-
skill business services had the greatest positive impact from increased
female workforce participation.

10
 SIZING UP A LOST
OPPORTUNITY
FEMALE LABOUR FORCE PARTICIPATION RATE IN INDIA

What has been a trend in India’s For those of us who believe that
case is that, as the country has demography is destiny, this
become more prosperous, the missing dividend – which is
female LFPR rate has fallen. Female equivalent to the entire workforce
LFPR in India is down from 37.7 of western Europe today – should
percent at the time of the 2001 highlight the enormity of a lost
census to 23.4 percent today. opportunity.

LOOKING AHEAD, EVEN IF INDIA’S LFPR REMAINS AT CURRENT

LEVELS, AS THE COUNTRY’S YOUTH POPULATION EXPANDS, WE
COULD SEE ANYWHERE BETWEEN 90 MILLION AND 170 MILLION
MISSING WORKERS IN THE ECONOMY, AS WOMEN VOLUNTARILY
OR INVOLUNTARILY CHOOSE TO STAY OUT OF THE JOB MARKETS

Figure 3: India’s workforce could have been 20-30 percent larger if it

had similar levels of female LFPR as other emerging markets.

11
Source: OECD, ILO
 SIZING UP A LOST
OPPORTUNITY
IMPACT OF A LOWER FEMALE LFPR ON GDP

Since a number of us also tend to Under these assumptions, India in

measure a country’s economic 2018 lost around USD1.4-2.8 trillion
might in terms of its GDP, it would in GDP (PPP, Constant 2016 prices)
be useful to quantify how much is due to a lower LFPR. To put that
the GDP impact of a lower female into perspective, this foregone
LFPR. opportunity is equivalent to the
entire economy of France and
To calculate this, we use the Spain. The costs of lower LFPR over
Conference Board database on the coming decade are even
GDP per worker and attribute a 6 heavier.
percent y-o-y growth rate in labour
productivity (the trend over the last
15 years) until 2030. Furthermore, As Figure 5 shows, the size of the
we assume that the female worker Indian economy will be USD2.5-5
who is currently unemployed will trillion smaller, if the women’s
have the same average level of workforce participation continues
productivity as that of the current to languish at the current levels.
people in the labour force. This is a The potential loss to GDP could
fair assumption at least in India’s probably be even higher, as we do
case, given that a significant share not take into account the
of Indian housewives tend to be productivity boost that firms in an
equally as educated, if not more, economy receive from gender
relative to the average worker. diversity.

12
 SIZING UP A LOST
OPPORTUNITY
Figure 4: IndiaIMPACT OF loses
currently A LOWER FEMALE
a GDP LFPR to
equivalent ONthe
GDPsize of the
French economy by keeping women locked out of job markets. The
loss is likely to widen over time

Source: Conference Board, OECD, ILO

13
 FEMALE LFPR IN
AGRARIAN VS
INDUSTRIAL
ECONOMIES

While the current precipitous dip in Indian

women’s workforce participation rate needs to be
addressed, it’s still worth asking if this trend is really
something we should worry about? Could this
similar to trends that have played out in different
countries at specific times in their economic
development cycles? Some preliminary research
evidence hints towards this.

Before going further, let us recap how LFPR has

changed for Indian women since Independence.
The earliest available census data on India’s female
LFPR comes from the 1961 census, which shows it
was at 42.9 percent. Thereafter, the LFPR stabilised
at around 30-35 percent for the next 40 years.
However, from the mid-2000s onwards, there has
been a sharp decline in female LFPR to its current
levels of 23-27 percent (varies by methodology).

To an extent, some decline in female LFPR is

expected in any economy that undergoes rapid
industrialisation. Part of it is due to the way in
which industrial work and corporate hours are
structured; part of it is due to the way in which
GDP is measured (ignoring the value of unpaid
housework).

14
 UNDERSTANDING THE
U-CURVE
In general, why does this pattern – Figure 6 plots female LFPR against
of a decline in female LFPR in national per capita income. In
economies undergoing rapid general, the female LFPR in
industrialization – happen time industrialising middle-income
and again in different countries. emerging markets such as South
Africa, Mexico, and Turkey was
Claudia Goldin of the University of lower than that of the LFPR in low-
Chicago explored this in a widely income, natural resource-driven or
cited paper in 1994. She showed agrarian economies such as
that the female LFPR has the Mozambique, Rwanda, and
tendency to follow a U-Curve as Ethiopia.
the economy develops. Women’s
participation remains high in a pre- Furthermore, as the per capita
industrial economy; it dips when income rises, as seen in the case of
the economy starts to move China, Myanmar, and Turkey,
towards factories located away female LFPR has fallen between
from homes and with fixed 1990 and 2017.
working shifts. It finally begins to
rise when the economy starts to On the other hand, countries like
move towards high-skilled, service- Korea, Mexico, and Brazil, which
based jobs and when investment were already on the verge of
in education has enabled a middle-income threshold in the
generation of women to seek 1990s, saw the female workforce
diverse and more remunerative participation rate increase over the
employment opportunities, which next two decades, due to higher
become relatively more attractive contribution to the economy from
to staying at home. retail, trade, community, social, and
business services sectors, which
Prima facie, the hypothesis does tend to employ more workers than
seem strong, if we look at the data mining and assembly-line
from 1990 to 2017. manufacturing.

15
 UNDERSTANDING THE
U-CURVE
Figure 5: The world in 1990, when China and India were still under-
developed and had a relatively larger share of women working

Source: OECD, World Bank, ILO

Figure 6: Some signs of a U-Curve. China, India have lower female

LFPR but are richer; Italy, Mexico are on the rising arm of the U-Curve

16 Source: OECD, ILO

 INDIA AND
THE U-CURVE
If female LFPR tends to follow a U- RELATIONSHIP BETWEEN FEMALE
curve for most economies, should LFPR AND NATIONAL PER CAPITA
we be worried about the fall in INCOME
India’s LFPR over the last 15 years?
Should we assume that over time, First, the U-Curve hypothesis
as our women become more perhaps wrongly assumes that
educated, their participation in the female economic participation
economy will increase? Will faster depends on national per capita
globalisation also help, as new income. What if it is the other way
ideas and business processes move round? What if the rapid increase
across borders and new in women’s participation in the
opportunities open for everyone in economy in the 1980s and 1990s in
the economy? the SE Asian and some Latin
American economies itself was a
reason behind the increase in their
FEMALE LFPR MAY NOT FOLLOW A economic prosperity? It could be
U-CURVE EVEN AS THE COUNTRY that the governments and society
GROWS RICHER, ESPECIALLY IF in countries like Mexico, Brazil,
THE SOCIAL AND INSTITUTIONAL South Africa, and Indonesia
FRAMEWORKS ARE NOT created laws, work environments,
SUPPORTIVE. and institutions that allowed
women to participate more
From India’s perspective, the U- actively in the economy, hence
Curve looks comforting. That said, leading to more economic
as later studies have pointed out, prosperity.
two things being correlated does
not mean that one necessarily There are other unexplained
causes the other.  If we look at the aspects to it as well. For example,
data on a country-by-country basis, there are countries such as Turkey
it appears that U-Curve is simply a which got richer in the last three
pattern that emerges when you try decades, relative to some of these
to look hard at a lot of data points. star performers, but still saw a
It could be merely co-incidental. decline in female LFPR.

17
 INDIA AND
THE U-CURVE
Even among advanced economies, Higher educational skills improve
the LFPR for women in Japan has their long-term employability. Easy
barely moved in the last three availability of credit encourages
decades, and their share in senior some women towards self-
management positions has employment, arranging their lives
remained lower than that in both around their children. Finally,
China and India, despite the economic growth also increases
national income per capita today the supply of household
being almost 30 percent higher appliances such as refrigerators,
than it was in 1990. Clearly, an washing machines, cooking stoves,
increasing LFPR as the economy and cleaners, which automate and
grows and diversifies is not a given. drastically cut down the time
taken for housework. Indeed, these
Finally, the other underlying were the factors that doubled the
rationale behind a positive female workforce participation in
relationship between female LFPR the US between 1940 and 1980.
and higher per capita income is
that improvement in female health However, what is true for the US
and education, alongside easy and Western Europe cannot be
availability of credit and a valid for other economies,
reduction in the opportunity cost especially if they have very different
of housework, usually accompany cultures. Indeed, could there be a
fast economic growth. They did so case where, despite such positive
in the post-war decades in the US factors affecting the well-being of
and European economies. women, the female LFPR
continues to decline? Is there a
Improvements in health services situation where, despite being
and reduction in maternal more educated and healthier than
mortality rates reduce the burden their mothers or grandmothers,
of disease and disability that women still face invisible barriers
employers face when hiring to economic participation? Is India
women. facing that situation?

18
 FACTORS IMPACTING LFPR
IMPACT OF ECONOMIC GROWTH COMPOSITION, JOB OPPORTUNITIES

Women’s participation in workforce is not just a function of

economic growth, but of its composition too; India’s growth path
is likely to create less jobs in sectors that have traditionally
employed more women.

More nuanced studies on LFPR show that women’s participation in the

workforce is not just a function of economic growth, but also the
composition of the economic growth and employment opportunities.

In India, agriculture remains the most widely available occupation within

the country, and also the largest employer of women. However, as the
economy progressed and agriculture became more mechanised, the
agriculture industry lost 35 million jobs in the 13 years since 2005. Of this,
close to 24 million workers were women. Unfortunately, employment
growth for female workers has been insufficient to compensate for this
loss.

Other nations who have made this progression from an agricultural to a

modern economy found different ways to make up for the female
workforce participation that was lost due to mechanisation of agriculture
and animal husbandry. Notably, they became the garment
manufacturing and assembly centres of the world; for example, countries
like Vietnam and Ethiopia have maintained female LFPR rates close to
70 percent.
20
 FACTORS IMPACTING LFPR
IMPACT OF ECONOMIC GROWTH COMPOSITION, JOB OPPORTUNITIES

In the case of Bangladesh, which saw women workforce participation

rates rise from 3 percent at the time of its independence in 1971 to 36.4
percent today, much of this improvement has come from better access
to credit, which has helped women set up small businesses and enabled
them to invest in their skills or take care of family emergencies, allowing
them to become a more active and able participant in the country’s
booming export sector. When it comes to gender equity in the economy,
Bangladesh’s elder south Asian siblings have much to learn and catch
up.

Meanwhile, the acceleration in female LFPR in Latin America in the 1990s

and early 2000s came from an increased number of job opportunities for
women in organised retail, hospitality, and community services sector
(teaching and nursing).

In this context, India’s female LFPR growth remains at risk. India seems to
have lost the opportunity to capitalise on labour intensive manufacturing
that has moved out of China due to rising labour costs there. Indeed, as a
recent report by Bloomberg pointed out, countries in the South East and
East Asia have been net beneficiaries in terms of FDI following the trade
disputes between the US and China. This has happened as firms have
gradually moved manufacturing supply chains to countries not so
strongly limited by the US import tariff barriers, the impact of this shift on
FDI investments in India has been negligible.
21
 FACTORS IMPACTING LFPR
IMPACT OF ECONOMIC GROWTH COMPOSITION, JOB OPPORTUNITIES

That said, foreign investment continues to pour into India, but largely in
software and IT services, telecommunications, and business services
sectors. However, jobs created in these sectors cater to the high skilled
and highly educated segment of the workforce, which is
disproportionately male.

At 26.7 percent, India’s share of female population enrolled in tertiary

education remains still remains below the global average of 40 percent.

Second, unlike other emerging markets, India remains under-invested in

healthcare and education, which tend to be the major employer of
women when an economy moves from a low-income to a middle-
income phase.

Furthermore, as automation replaces labour-intensive jobs in the coming

decade, the first casualties will precisely be the kind of labour-intensive
jobs that created the conditions for a faster growth in female LFPR over
the last three decades in other emerging markets.

Therefore, in many ways, automation induced inequality is likely to hurt

women more than men, since they tend to be less educated relative to
men, and remain at a greater risk of being driven to obsolescence by
automation.

22
 FACTORS IMPACTING LFPR
IMPACT OF CULTURAL NORMS

Cultural norms can be a powerful factor limiting LFPR, especially

as, in South Asia, the domestic and household expectations from
women are higher than elsewhere in the world

Cultural norms are the second factor that impede a greater female LFPR.
While LFPR based estimates portray India to be an intensely gender-
unequal and oppressive society towards women, this still would be a
one-sided judgment that ignores the marked progress the country has
achieved in women empowerment in the 21st century.

Female literacy rates have gone up from 18 percent at the time of

independence in 1947 to 62 percent in 2011. Maternal mortality rates and
fertility rates have also seen a decline. As the National Family Health
Survey 2017 noted, compared to the countries with similar levels of
economic development and income, percentage of Indian women who
said they were in control of their health and reproductive decisions was
8.2pp higher.

As per the Economic Survey 2018, India registered a similar

outperformance relative to its peers when it came to empowering
women to be the primary decision-maker on household purchases and
expenses. However, the gains on these dimensions were almost offset by
a lower-than-average workforce participation rate for women and on the
agency they have in making career choices and professional decisions.
24
 FACTORS IMPACTING LFPR
IMPACT OF CULTURAL NORMS

Seen in this light, the data implies that while the modern Indian society
is ready to empower and give greater responsibilities to women within
the confines of the household, it remains reluctant to let them step out
and enter the labour force. Employment for female members of the
household is usually seen as a desperate option undertaken by families
in times of financial distress. The effect of cultural norms on limiting
female LFPR cannot be underestimated.

Figure 7: India and Turkey are the only nations where female LFPR
did not rise as the number of children per woman fell; cultural norms
bind women to households despite lesser childcare time

Source: World Bank

25
 FACTORS IMPACTING LFPR
IMPACT OF CULTURAL NORMS

In the case of Japan, much of what holds back female participation in

one of the most developed economies of the world is a carryover of
cultural norms from the feudal times, which assumes that women are
best-suited to child-bearing and domestic responsibilities, which are
often unpaid.

Today, as Japan remains trapped in a near-zero growth and negative

interest rate regime, enabling women to get to work has become a focal
point of Prime Minister Shinzo Abe’s strategy to rejuvenate the economy.
Its progress, since 2013, on increasing women’s participation in the
workforce has been significant. However, this cannot undo the prosperity
lost in the previous decades by excluding them from the labour market.

India’s cultural norms become even more unfavourable to female LFPR

relative to other collective, family-oriented societies in Asia. In many ways,
the expectations for household responsibilities are more challenging for
women in South Asia, relative to East Asia.  For instance, in China, Korea,
and South-East Asia, the domestic responsibilities such as childcare and
household chores are shared between the elderly in the household and
the prime-aged female of the household (in most cases, the daughter-in-
law).

That participation is much less so in India’s case and is considered

culturally less acceptable.
26
27
 FACTORS IMPACTING LFPR
IMPACT OF CULTURAL NORMS

In South Asian households, the expectations are to take care of both the
elderly parents, in-laws, and children, without much assistance from
other members of the extended family. Employing domestic help, or
leveraging the opportunities of the O2O economy (food ordering, service
on call), to lessen the burden of housework is culturally frowned upon.
No wonder then that employment is seen as an option of last resort.

This may explain why states in Northern and Western India have seen the
sharpest decline in female LFPR, even as they have raced ahead of others
economically. Women there have just chosen to use the increased
household income to buy more free time and mind-space, allowing
them to concentrate on domestic tasks that are socially perceived to be
more central to their role, though not equally remunerative.

Therefore, it remains a question as to whether the higher enrolment of

women at the school and college levels that we have seen since 2003,
will actually result in higher participation of women in the economy. Or
will they continue to turn down a paying career to become dedicated
home-makers serving parents and children. The point of this argument
is not to belittle the contribution of the Indian housewife, or to look at
the culture pejoratively. Domestic work could be immensely fulfilling for
women, as well as for men. However, it needs to be offered as a choice
and not as a cultural norm. And the opportunity costs it imposes on
economic growth must be understood well.
28
 FACTORS IMPACTING LFPR
IMPACT OF POOR PUBLIC SAFETY AND TRANSPORT, LACK OF CREDIT

Lack of credit, poor public safety, and inadequate investment in

public transport also inhibit female LFPR growth

Finally, even for families which are willing to support women at work in
India, helping them find a good and fulfilling career remains a challenge.

Multiple factors dissuade women from achieving their potential,

especially if they decide to become self-employed.

Access to credit remains a challenge, given that as per the EIU, less than
13 percent of women in India hold any assets separate from their spouse
or family, which could be pledged against a loan.

Second, underinvestment in public transport infrastructure means that

women who wish to arrange their lives around their children and
parents-in-law have a difficult time commuting between home and
office (they are also less likely to own a vehicle). Perforce, they end up
taking part-time jobs or resign, which could severely impact their sense
of self-worth.

29
 FACTORS IMPACTING LFPR
IMPACT OF POOR PUBLIC SAFETY AND TRANSPORT, LACK OF CREDIT

As Satpal, Rathee and Rajain (2014) noted in a paper, women

entrepreneurs also find it difficult to engage in business travel, rent hotels
in tier 2 and 3 towns, and be taken as serious and committed
professionals by investors.

Another limiting factor, as noted by World Bank, is the lack of safety,

particularly when working late hours. In the absence of better policing,
the response of the corporate sector towards ensuring safety for women
has been to bar them from overnight shifts and to overlook them for
assignments which require them to collaborate in real-time with clients
in the US or Europe.

30
 THE ROAD TO HIGHER LFPR
FROM WELFARE-BASED APPROACH TO EMPOWERMENT-BASED ONE

So far, the approach of successive governments in India towards gender

equality has been driven by a welfare-approach rather than an
empowerment approach. Central and State governments have taken
laudable steps to reduce the burden of housework (subsidised LPG
connections and distribution), limit the time spent to look for water,
increase enrolment, and benefits for natal and post-natal health.

That said, the bias has been towards “caring” for women, rather than
“enabling” them; something that is implied by the fact that India still has
a Ministry of Women and Child Development, hinting that both these
vulnerable groups require some kind of state protection.

31
 THE ROAD TO HIGHER LFPR
FROM WELFARE-BASED APPROACH TO EMPOWERMENT-BASED ONE

The need to boost female LFPR has more to it than economic

pragmatism. Work that is gainful and remunerative has a positive
psychological impact on people. It enhances their confidence in
themselves, pushes them to discover more of their abilities, and allows
them to strive for their ambitions.

This is why, its absence, whether enforced by cultural or institutional

norms, is a gross denial of human rights. No amount of agency, wealth,
and prosperity transferred to women within their households today can
be an excuse to deny them a choice of a career.

FOR THIS REASON, THE NEXT GOVERNMENT IN INDIA, OF WHICHEVER

POLITICAL PERSUASION IT BE, MUST MAKE IT A POINT TO INCLUDE AN
INCREASE IN WOMEN'S ECONOMIC PARTICIPATION AS A PART OF ITS
VISION.

In addition, it will do well to target a healthy LFPR as a key metric to

measure it, alongside its other targets of improving business regulations
and global competitiveness.

32
 APPENDIX

Working Age Population

We have taken the OECD’s definition of Working Age Population as the
people of both genders, falling in the age group 15-64 years of age.
Usually not everyone in this age group works. Some people keep
studying until 25, others retire at 50. On the other hand, some elderly,
keep working, despite having crossed 64 years of age. Across the world,
only about 75-85 percent of the population in this age group is gainfully
employed.

Labor Force Participation Rate (LFPR)

Simply put this equals = Number of people eligible to participate in the
labor force who are actually working or actively looking for work / (Total
Working Age population (Active and Inactive))
Female LFPR simply restricts itself to the sample of women

Varying assessments of LFPR for India

Data from International Labor Organisation (ILO) taken in 2012 are
based on numbers from National Sample Survey. They show LFPR for
2012 at 23.4 percent. Data from World Bank Development Indicators
from 2017 show the LFPR at 27.2 percent.
Our motivation in this study was to see the long-term evolution of LFPR
and then, to test the U-Curve hypothesis. ILO is much better at historical
numbers. Therefore, we use this data.

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 SOURCES

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Sandra Tzvetkova; Esteban Ortiz Ospina, Our World in Data (Oct 16,
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A Job of Her Own; The Economist (July 7, 2018)
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Deka, Productivity Vol.4; Jan-March 2018
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Soumi Rai; Journal of Strategic HR Management; June 2012
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India; Rahul Lahoti and Hema Swaminathan; 2016
Economic Survey of India, 2017-18
Reversing women’s decline in Indian Labor Force; Mint; June 26, 2018
Travel Safety and Child Care can encourage women to go to work;
Annette Dixon; Suman Layak; The Economic Times; March 12, 2018
The 217 Million missing women in India’s workforce; Mint; June 8, 2015
India’s missing women workforce; Mint; Dec 31, 2012
The U-Shaped Female Labor Force Function in Economic
Development and Economic History; Investment in Women’s Human
Capital and Economic Development; Claudia Goldin; University of
Chicago Press; 1994
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Era; International Journal of Advanced Industrial Engineering; Satpal;
Raathee, R., Rajain, P.; 2014
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