The economic well-being of women, in five charts
1. All work, no pay
Indian women may make headlines in leadership roles, but their participation in the labor market is unusually dismal by global standards. Just a dozen countries fare less well. Despite better education and opportunities, the last three decades have seen a steady decline in women’s participation in the labor market, mainly due to the rural sector, where it has almost halved. Economist Mitali Nikore attributes this to the mechanization and automation of agriculture.
Conservative norms dictate that women shoulder the burden of unpaid domestic work instead of going to work. Women put in seven hours a day on this job, compared to 2.9 hours for men, according to a 2019 time use survey. No wonder the pandemic has hit female workers disproportionately.
A policy focused on relieving women of these tasks could be useful. Nikore sees solutions in formalizing affordable care services and addressing infrastructure issues such as safe mobility.
Declining labor market participation costs not only women, but also the economy: parity could boost India’s GDP by 27%, according to estimates by the International Monetary Fund.
2. Beveled at the top
Women are also vastly underrepresented in the upper echelons of corporate management. According to a Mint analysis, only 9.6% of non-independent executive directors of listed companies in India are women, up from 5.4% in 2014. Progress has been too slow for a period that has seen growing demand for parity . Nearly a quarter of the gains came from sectors such as banking and finance, fast-moving consumer goods and healthcare.
The disparity is also glaring in terms of remuneration. The pay gap widens as women progress in their careers, according to research by Promila Agarwal, an associate professor at the Indian Institute of Management in Ahmedabad. Women at lower levels earn 2.2% less than men, but the deficit rises to 6.1% at managerial levels, Agarwal’s review of an analysis by pay data firm Payscale showed. She suggested companies need to make conscious efforts to redesign compensation systems so that pay gaps can be checked if they widen due to biases and mindsets.
3. Funding filters
Prejudices also play negatively for enterprising women trying to uplift themselves. Limited financial access hinders the progress of women entrepreneurs. Even though 2021 has seen more female-led startups reach $1 billion in valuation than ever before, less than 15% of Indian unicorns are led by women, according to data from VCCEdge.
“It’s not a matter of supply for sure and we’ve proven that unequivocally,” said Nruthya Madappa, director of 3one4 Capital, a start-up venture capital (VC) firm. brilliant women to continue to build and evolve.”
According to a 2019 report by the International Finance Corporation, only 7% of total private equity and venture capital funds in emerging markets go to women-led businesses. Venture capitalists with female partners were twice as likely to invest in companies with mixed management, according to a US study.
“But there are so few of us on this side of the table, in leadership positions, making investment calls,” Madappa said.
4. Financial Freedom
Women’s financial inclusion can play a key role in economic empowerment, and this has accelerated in recent years. The share of women among individual borrowers fell from 34.7% in September 2021 to 27.5% five years ago, while their share in the total amount of loans fell from 19.5% to 22.4 %, according to Reserve Bank of India data.
The main catalysts for growth have been the credit mainly given to women at subsidized rates under the Pradhan Mantri Awas Yojana, and the increasing share of microfinance in credit, where the main clients are women-led groups, said Revati Kasture, Senior Director of CareEdge. “In general, female borrowers have a much higher propensity to save and repay their loans,” she said.
Despite these developments, more progress needs to be made to achieve greater financial equality and inclusion for women.
5. Women traders
On the bright side, more women are now meddling in the stock markets, which have traditionally been a male stronghold. Women’s participation in capital markets has increased and analysts estimate that women now make up nearly 25-30% of the trading tribe. The number of new female investors has more than doubled every year since 2019, mostly in smaller cities, according to a report by ICICI Securities. Young women (aged 25-35) are leading investment trends as the pandemic has helped catalyze investors’ transition to equity markets.
“Women tend to be more patient and risk averse than men and can become excellent long-term investors,” said Vijay Chandok, managing director of ICICI Securities. As women become financially independent, they will channel their savings and investments into the market, analysts said.
While the government can go a long way in offering incentives, the market ecosystem could also raise awareness. “There could be tailored products and services for women investors that would help them plan their finances,” Chandok added.
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