Female Labour Force Participation in India and Beyond

The participation of women in the labour market varies greatly across countries, reflecting differences in economic development, education levels, fertility rates, access to childcare and other supportive services and, ultimately, social norms. For this reason, participation rates vary considerably across the world with some of the lowest rates witnessed in South Asia. The trends in the female labour force participation rate in South Asia reveal a number of puzzles. Most notable is the falling participation of women in the Indian labour force, especially in rural areas, which occurred despite strong economic growth and rising wages/incomes. Understanding these issues is critical because: (i) female labour force participation is a driver of growth and thus participation rates indicate the potential for a country to grow more rapidly; (ii) in many developing countries, participation of women is a coping mechanism which arises in response to economic shocks that hit the household; and (iii) participation is an (imperfect) indicator of women’s economic empowerment. To improve labour market outcomes in countries like India, policy interventions should consider both supply and demand, including improving access to and relevance of education and training programmes, promoting childcare and other institutions/legal measures to ease the burden of domestic duties, enhancing safety for women, and encouraging private sector development in industries and regions that would increase job opportunities for women in developing countries.