The recently released Annual Report of the latest Period Labour Force Survey (2023-24) shows a continuation in the trend of increasing labour force participation rates (LFPR) and worker population ratios (WPRs) and decreasing unemployment rates (UR) observed since the first PLFS conducted in 2017-18.
All India LFPR for those above 15 years of age has increased from 49.8% in 2017-18 to 60.1% in 2023-24, WPR from 46.8% to 58.2% and URs have reduced from 6% to 3.2%.
On the face of it, these are significant changes. But what do they really mean in terms of job creation in the economy and the contribution of employment to people’s living conditions?
Even a superficial glance at the data show that most of these trends are being driven by women’s employment. Since the 1980s, India had been facing a situation of declining female LFPRs in rural (except for an increase in 2004-05) until a reversal of this trend in 2017-18. In urban areas, the FLFPRs have been more or less stagnant but low, and even here there seems to be an increase in recent years. A number of supply and demand side factors have been discussed in the literature to explain the low and declining FLFPRs rates in India. Women’s increasing participation in higher education and women withdrawing from the labour force as household incomes increase have been common explanations.
Further, cultural norms placing restrictions on women’s mobility, increasing household responsibilities and burden of unpaid domestic and care work have also been discussed. Demand side factors related to fewer women being absorbed in agriculture and unavailability of jobs in the non-farm sector for women is also an important factor.
Clouding all analysis of women’s employment using large scale data such as from the PLFS is the issue of how well and accurately these surveys capture women’s work in the first place. It is accepted that these surveys do generally underestimate women’s work/employment.
In this context, the recent trends in FLFPRs showing a stark increase in women’s employment are puzzling. Rural FLFPR for women above 15 years of age has increased from 24.6% in 2017-18 to 47.6% in 2023-24, and in urban areas the corresponding increase is from 20.4% to 28%. The male LFPR (15 years and above) has seen a smaller change in this period – from 76.4% in 2017-18 to 80.2% in 2023-24 in rural areas, and 74.5% to 75.6% in urban areas during the same time period. It is obvious from this data that the overall trends in employment are mainly a reflection of the changes in the female LFPRs. There are no changes in the PLFS questionnaire and no known reasons to believe that there has been a sudden improvement in the capturing of women’s work in these surveys (although this could be investigated further) to attribute these trends to comparability issues. Neither are there any major changes in the supply side factors affecting women’s employment in this six-year period.
Also read: Narrative of Lower Female Labour Participation is False When We Recognise Women’s Work
One aspect from the data which does provide some clue to what might be happening is the corresponding increasing in self-employment. The proportion of women workers in rural areas who are in the self-employed category has increased from 57.7% in 2017-18 to 73.5% in 2023-24. A high proportion (more than half) are in the helper in household enterprise category. Self-employment is high among men as well but does not see a similar increase – 57.8% in rural areas in 2017-18 to 59.4% in 2023-24. In urban areas too the share of self-employment among women workers has gone up, from 34.8%in 2017-18 to 42.3% in 2023-24. Self-employment in India does not usually represent profitable entrepreneurial ventures, rather often is a sign of distress where in the absence of any other gainful employment opportunities people are finding ways to fend for themselves.
While further analysis is required to unpack this trend of increasing FLFPRs along with a much higher share of self-employment, the sectoral distribution of employment observed also show that at least partly this has to do with distress. The share of agriculture in rural women’s employment is still very high and has also increased from 73.2% in 2017-18 to 76.9%. In urban areas there is no major shift with a large proportion of women workers being in ‘other services’ and in manufacturing. Therefore, this increase in labour force participation is not accompanied by any positive structural change in employment, rather is mostly dependent on agriculture.
Even when one looks at the earnings from self-employment, women’s earnings are very low and the gender gap remains huge.
Data on earnings is given on a quarterly basis in the PLFS report. For the 2023-24 quarter, highest earning from self-employment (during last 30 days) is reported for the April to June 2024 quarter – Rs 14,564 for rural males and Rs 5,218 for rural females; Rs 23,480 for urban males and Rs 8,492 for urban females. Therefore, women in self-employment earn only about one-third of what men do. The average earning for women in rural areas is much less than one lakh per annum and in urban areas is just about a lakh.
This doesn’t bode very well towards the goal of making ‘lakhpati didis’.
What is clear is that studying short term trends in employment without including a gendered analysis does not make much sense any more. Second, although there is this tremendous increase in women’s work participation rates, there is nothing in the data that show that this is a positive shift towards improving livelihoods. Instead, what it probably indicates is the pressure on women to contribute to household incomes in times of distress.
Dipa Sinha is a development economist.
