MacroScan - Women Workers in Urban India

In the era of globalisation, it has become commonplace to argue that trade openness in particular generates processes that encourage the increased employment of women, particularly in export-oriented activities. In addition, development in general and higher per capita incomes are supposed to lead to more employment in services and shifts from unpaid household work to paid work, which also involve more paid jobs for women workers.

Data from the recent large sample employment survey of the NSSO would appear to provide confirmation of this perception. Work participation rates of women workers have increased in 2004-05, not only in comparison with 1999-2000 when they had fallen sharply, but also in comparison to a decade earlier. However, this process needs to be considered in more detail to see whether it is indeed the positive process outlined above. Since this is meant to be much more marked in urban areas, this article is concerned with changes in employment patterns of urban women workers in India.

As Chart 1 shows, work participation rates have indeed increased and in 2004-05 were at the highest rate of the past 25 years. (The year 1999-2000 now appears to be a significant outlier, and other problems with that data suggest that the long terms trends are confirmed by the most recent data.) Of course, these work participation rates are still low by international standards, and reflect substantial variation across states, with southern states showing generally higher rates.

Chart 1 >> Click to Enlarge

Chart 2 shows how the age specific work participation rates for urban women have changed over the past decade. There is a general tendency for women to enter into paid work at younger ages than previously - participation rates among younger urban women increased by about 2 percentage points compared to 1993-94 and 5 percentage points compared to 1999-2000. And the peak work participation rate for urban women has shifted from the age group 40-44 years in 1993-94 to 35-39 years in 2004-05.

Chart 2 >> Click to Enlarge

So what type of employment do urban women workers find? Table 1 shows that there has been an overall decline in casual employment and a general increase in regular work and self-employment. The shift is especially marked in the case of principal activity, with more than 42 per cent of urban women workers now reporting themselves as having a regular job. When subsidiary activities are included, self-employment assumes greater significance, with nearly 48 per cent reporting as self-employed.

Table 1: Type of employment of usually employed urban women
	Principal Status only			Principal + Subsidiary Status
	Self-employed	Regular	Casual	Self-employed	Regular	Casual
1983	37.3	31.8	30.9	45.8	25.8	28.4
1987- 88	39.3	34.2	26.5	47.1	27.5	25.4
1993- 94	37.2	35.5	27.3	45.8	28.4	25.8
1999- 2000	38.4	38.5	23.1	45.3	33.3	21.4
2004- 05	40.4	42.2	17.4	47.7	35.6	16.7

Table 1 >> Click to Enlarge

This is certainly a phenomenon to be welcomed, especially if it does indeed indicate a shift to more productive and better remunerated activities than are to be found with casual contracts. However, this needs to be confirmed with evidence on the specific activities that are engaged in and the trends in wages.

Table 2 provides the evidence on the broad sectoral classification of work of urban women. Predictably, agriculture shows a substantial decline over time. However, elsewhere there are surprises. The share of manufacturing has increased slightly, but at around 28 per cent it is not much higher than the proportion achieved in 1987-88, that is well before any export-led manufacturing boom was in evidence. So the overall proportion of women in manufacturing employment in urban India does not support the notion of a big increase in female employment consequent upon greater export orientation of production.

Table 2: Main sectors of employment of urban women workers (Principal plus subsidiary status)
	Per cent of usually employed urban women
	1983	1987-88	1993-94	1999-2000	2004-05
Agriculture	31	29.4	24.7	17.7	18.1
Manufacturing	26.7	27	24.1	24	28.2
Construction	3.1	3.7	4.1	4.8	3.8
Trade, hotels & restaurants	9.5	9.8	10	16.9	12.2
Transport & communications	1.5	0.9	1.3	1.8	1.4
Other services	26.6	27.8	35	34.2	35.9

Table 2 >> Click to Enlarge

Even trade, hotels and restaurants, which are activities traditionally considered to attract a lot of women workers, do not show much increase, and the share of these has even declined compared to 1999-2000. The clear increase, even if not very dramatic, is for other services, which is a catch-all for a wide range of both public and private services, as well as both high value added high-remuneration jobs and very low productivity low paying survival activities.

It is worth considering the patterns in manufacturing employment in more detail, particularly because the work of women can be easily misclassified in the available data. In particular, the usual status definition which includes both principal and subsidiary status activities can be a source of confusion. It is possible that women are classified as ''usually working'' when in fact it may reflect underemployment or engagement in a subsidiary activity only. Indeed, there can be substantial variation in the type of employment contract depending upon whether the activity is a ''principal'' one or a ''subsidiary'' one.

Chart 3 makes this very evident in the case of manufacturing employment. In terms of principal status, the share of women workers in manufacturing has fluctuated sharply between 23 and 27 per cent, and there is no evidence of a clear trend. However, the share of women working in manufacturing in a subsidiary capacity (that is, not as the perceived principal activity of the women concerned) has been increasing continuously since 1987-88, and now accounts for as much as nearly 3 per cent of all urban women workers. This in turn is now as much as 11 per cent of all women employed in manufacturing - surely not a small proportion.

Chart 3 >> Click to Enlarge

What could explain this very substantial difference once subsidiary activities are included? One important factor may be the increase in putting out home-based or other work as part of a subcontracting system for export and domestic manufacturing. Such work does not get incorporated in the employment statistics which are based on employers' records, and this may explain the paradox that even while women's share of employment in manufacturing has not increased much, the dependence of the sector - and especially of export-oriented manufacturing - on the productive contribution of women may well have increased.

This suggests that the direct and formally recognised involvement of women may have stagnated even in the period of the relative higher growth of exports over the last decade. However, home-based subcontracting activities, or work in very small units that do not even constitute manufactories, often on piece rate basis and usually very poorly paid and without any known non-wage benefits, may to some extent have substituted for the more standard form of regular employment on a regular wage or salary basis.

Table 3 provides some data on the actual numbers of women employed in various activities in urban India, based on applying the NSSO work participation rates to the Census estimates and projections of urban population. The results are quite startling, especially in the context of the much-trumpeted high output growth rates which are widely felt to have predominantly affected urban India in positive ways.

Thus, it turns out that relatively few sectors now account for two-thirds of all women workers, whether in principal or subsidiary status. Some of them are indeed the dynamic export-oriented activities. Thus, the number of women employed in textiles has nearly doubled and those in apparel and garments have increased by more than two and a half times. There has also been significant increase in employment in the leather goods sector.

In the service sectors, there has been very little increase in female employment in public administration, reflecting the overall constraints on such employment, although employment in education (mainly with private employers) has shown a large increase. However, the biggest single increase after apparel - and the category of work that is now the single largest employer for urban India women - has been among those employed in private households. In other words, women working as domestic servants now number more than 3 million, and account for more than 12 per cent of all women workers in urban India.

Table 3: Main sectors of employment of urban women workers
	1999-2000	2004-05	per cent change
Food products & beverages	400,441	418,593	4.5
Tobacco products	891,891	911,055	2.1
Textiles	1,037,506	1,920,602	85.1
Apparel	436,845	1,600,502	266.4
Leather & leather goods	72,807	196,985	170.6
Chemicals & chemical products	345,835	467,839	35.3
Construction	873,690	935,678	7.1
Retail trade	2,493,656	2,117,587	-15.1
Hotels & restaurants	400,441	615,578	53.7
Finance	273,028	418,593	53.3
Pub admin, defence & social security	709,873	763,316	7.5
Education	2,056,811	2,856,280	38.9
Employed in private households	946,497	3,053,265	222.6

Total	10,939,321	16,275,871
per cent of all workers	60	66
All urban women workers	18,201,866	24,623,103

Table 3 >> Click to Enlarge

It is indeed disturbing to see that the greatest labour market dynamism has been evident in the realm of domestic service. This is well known to be poorly paid and often under harsh conditions - and certainly, it cannot be seen as a positive sign of a vibrant dynamic economy undergoing positive structural transformation.

The newer activities that are much cited - such as IT and finance - continue to absorb only a tiny proportion of urban women workers, which is why they have not been included in this table. Thus, women workers in all IT related activities - that is, computer hardware and software as well as IT-enabled services - account for only 0.3 per cent of the urban women workers in this large sample, amounting to an estimated total of 74,000 workers at most.

Similarly, women workers in all financial activities - that is formal financial intermediation through banks and other institutions, life insurance and pension activities and other auxiliary financial activities - added up to only 1.4 per cent of the women workers in urban India. So there is clearly a long way to go before the newer sectors - or even traditional but more dynamic exporting sectors such as textiles and garments - can make a dent in transforming labour conditions for urban Indian women.

This is probably why the evidence on real wage trends of urban women is so disappointing. Chart 4 indicates that average real wages have fallen between 1999-2000 and 2004-05 for both regular and casual women workers, and have hardly increased much even in relation to more than a decade earlier. For an economy that boasts of one of the highest GDP growth rates in the world over this period, this is certainly an indictment.

Chart 4 >> Click to Enlarge