Stagnant Salaries Amid surge in women’s self-employment: Unveiling India’s Labor Paradox

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Stagnant Salaries Amid surge in women’s self-employment: Unveiling India’s Labor Paradox 

surge in women’s self-employment
surge in women’s self-employment


A recent report from the International Labour Organization brought a glimmer of hope for India, indicating positive real wage growth amid global economic turmoil. However, a closer inspection reveals a nuanced reality where stagnant salaries contrast with a surge in women’s self-employment, painting only half the picture of economic prosperity.

While the rise in real wages suggests an improvement in living standards, the situation is more intricate than it seems. The State of Working India 2023 report exposes the uneven terrain of wage growth, highlighting a concerning trend: a decline in earnings from self-employment coupled with a precarious surge in casual work.

increase in earnings for casual work

Real wage growth, it appears, has not spread uniformly across all forms of employment. Over a five-year period from 2017-’18 to 2021-’22, earnings from self-employment dwindled, while regular wage and salaried work remained relatively constant. In contrast, real earnings of casual workers experienced a modest increase. However, this increase still falls short of meeting the proposed national floor minimum wage, underscoring persistent disparities in remuneration.

Moreover, casual work, though seeing a nominal rise in wages, remains the most insecure and least remunerative form of employment. The situation is compounded by occupational segregation, disproportionately affecting marginalized communities such as Scheduled Castes, Scheduled Tribes, and Muslim workers.

In the realm of women’s employment, the scenario is equally bleak. Despite a rise in the share of women engaging in self-employment, their average real earnings have declined significantly. The majority of women in self-employment are relegated to unpaid helper roles or own-account work, indicative of distress-driven survival strategies rather than genuine entrepreneurial opportunities.

Wage disparities further exacerbate the issue, with women consistently earning less than men across all categories of work. The earnings gap is particularly stark in self-employment, where women earn a mere 40% of what men do.

The underlying factors driving these disparities extend beyond mere differences in observable characteristics. Discrimination and biases against women in the labor market play a substantial role, perpetuating inequities in earnings and opportunities.

Despite significant strides in labor productivity over the years, reflected in a six-fold increase in output per worker, real average wages have failed to keep pace. This disconnect underscores a fundamental imbalance where workers do not receive a fair share of the value they contribute.

Addressing these systemic issues requires multifaceted solutions. Institutional protections, including robust minimum wage laws and collective bargaining mechanisms, can help mitigate the adverse effects of automation on labor markets while ensuring fair wages. Additionally, public job creation initiatives and expanded support for programs like the rural employment guarantee scheme are essential for fostering inclusive growth and addressing gender disparities in employment and wages.

As India navigates the complexities of its evolving labor landscape, policymakers must confront these challenges head-on to realize the promise of equitable and sustainable economic growth for all its citizens.

Understanding the Complexities of Stagnant Salaries and the Surge in Women’s Self-Employment

surge in women’s self-employment :- CPPR


Q: What is the recent trend observed in India regarding wages and employment? A: Recent reports indicate a mixed picture regarding wages and employment in India. While there has been positive real wage growth overall, particularly in casual work, the situation is nuanced. Despite this growth, earnings from self-employment have declined, and there are concerning trends in the quality of jobs, particularly with regards to social security and wage disparities.

Q: Why are real wages increasing for casual work but declining for self-employment? A: Real wages for casual work have seen an increase, albeit modest, while earnings from self-employment have fallen. This discrepancy may be attributed to the precarious nature of casual work, where wages are typically low but have seen some nominal growth. On the other hand, self-employment, particularly for women, often involves distress-driven women’s work reflects with limited earnings potential.

Q: What are the implications of the rise in women’s self-employment? A: The surge in women’s self-employment, especially in rural areas, reflects underlying issues such as rural distress and limited job creation. However, a significant portion of women in self-employment are engaged in unpaid or low-paying roles, indicating a lack of genuine entrepreneurial opportunities and highlighting the need for alternative avenues for paid work.

Q: How significant are wage disparities across different social groups? A: Wage disparities persist across various social identities such as gender, caste, and religion. Women consistently earn less than men across all categories of work, with the widest gap observed in self-employment. Similarly, disparities based on caste and religion also contribute to unequal earnings, reflecting systemic biases and discrimination in the labor market.

Q: Why haven’t real wages kept pace with labor productivity? A: Despite significant increases in labor productivity over the years, real average wages have not risen proportionally. This disparity suggests that workers are not receiving a fair share of the value they contribute to production. Factors such as automation and labor-saving technologies have also influenced this trend by reducing the demand for labor.

Q: What measures can address these challenges? A: Institutional protections such as minimum wage laws and collective bargaining can help mitigate disparities in wages and ensure fair compensation for workers. Additionally, there is a need for greater focus on public job creation initiatives and support for programs like the rural employment guarantee scheme to foster inclusive growth and address gender disparities in employment and wages.

Understanding the complexities of stagnant salaries and the surge in women’s self-employment requires a nuanced approach that addresses underlying structural issues and promotes inclusive and sustainable economic development.

Understanding the Dire Employment Situation

Q: What is the current employment situation in the United States? A: The employment landscape in the United States is characterized by a significant prevalence of part-time positions compared to full-time jobs. Despite some signs of recovery, the ratio of part-time to full-time jobs has been increasing, which is concerning for both the economy and the workforce.

Q: How does the ratio of part-time to full-time jobs compare to historical trends? A: Historical trends show a significant shift in the ratio of part-time to full-time jobs. In recent years, the creation of part-time positions has outpaced that of full-time jobs. While previously, six full-time jobs were created for every one part-time job, the ratio has now flipped, with only one full-time job being created for every four new part-time jobs.

Q: What do the statistics reveal about labor force participation in the United States? A: According to data from the Bureau of Labor Statistics (BLS), a substantial portion of the American population is not currently participating in the labor force. As of July, nearly 90 million Americans were not part of the labor force, accounting for approximately 36 percent of the civilian non-institutional population.

Q: What are the unemployment rates, and how do they reflect the employment situation? A: The U-6 unemployment rate, which includes both unemployed individuals actively seeking employment and those who are marginally attached to the labor force, stands at 14%. However, the real unemployment rate, which factors in individuals who have given up looking for work, is estimated to be above 20%, indicating a broader issue in the labor market.

Q: Are there sectors offering opportunities for full-time employment? A: Despite the challenges in the broader employment landscape, advanced manufacturing presents opportunities for skilled workers to secure full-time employment. Many companies in this sector are facing a shortage of skilled employees and are offering greater-than-full-time employment to meet their operational needs.

Q: Why is there a subdued celebration of Labor Day in recent years? A: The subdued observance of Labor Day in recent years can be attributed to the dire employment situation prevailing in the country. With significant challenges such as a high ratio of part-time to full-time jobs, low labor force participation rates, and elevated unemployment figures, there is little cause for celebration within the labor force.

Understanding the complexities of the current employment situation requires acknowledging the prevalence of part-time positions, exploring avenues for full-time employment, and addressing the broader challenges impacting the workforce and the economy

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