FDI and Women Employment in India

BYARPITA MUKHERJEEDEBOSHREE GHOSH

FDI and Women Employment in India

1

Organized by: Institute of Social Studies Trust (ISST) in association with the Heinrich Boell Foundation (HBF)

New Delhi, April 9, 2013

Gender and Economic Policy Discussion Forum: The Politics and Economics of FDI through a Gender

Lens

Status of employment with focus on women employment

FDI and its linkages to women employment

Some examples of sectors with women employment

Challenges and Opportunities

2

Table of Contents

Women Employment: Global Overview3

Women constitute 40% of the global labour force, account for 58% of all unpaid work, 44% of wage employment and 50.5% of informal employment against 48.2% for men

Women dominate the service sector (47% of all employed women against 41% of men’s employment); are more likely than men to work in agriculture (38% of all employed women against 33% of all employed men); and much less represented in industry (16 % against 26% of all employed men)

In 2010 the female youth unemployment rate stood at 13.1% compared to 12.6% for males

The estimated number of workers in vulnerable employment in 2009 is 1.53 billion, and in most regions the vulnerable employment rate among women exceeds that of men

In two-thirds of emerging and developing countries where data is available, the share of informal employment stands at more than 40%

ILO evidence from 83 developed and developing countries shows that women earn between 10% and 30% less than men

In 2010, women accounted for just below 12% of board members in the largest publicly listed companies in the European Union, and for just over 3% of board chairs

Source : ILO, 2012

Employment in India

National Sample Survey (NSS) data shows addition of merely 2.76 million work opportunities during the period of fastest growth for the economy (2004-05-2009-10)

Compared to this, there was an addition of 60 million to the workforce during 1999-2000 and 2004-05

Women employment decreased considerably from 2.8 % to 2.2 % and is currently 128 million out of 460 million of total labour force.

It is interesting to analyse the impact of FDI on women employment as no other empirical study has been done in this regard. Therefore the question arise :-

With FDI in the country, what is the future of women employment in India?

Are women better off in states with more FDI investment?

4

No Official Data Prim

ary (

Agricu

lture

and fi

shing

)

Indus

try

Serv

ices

01020304050607080

53.2

21.5 25.4

69.6

16.314.1TotalWomen

Total employment and share of women employment (2009-10)- %

NSSO, 2009-10

• Majority in agriculture

• Financial intermediation and construction sector also employ a sizable number of women

• Lowest share in fishing, mining and transport

• Only 3.5 % are employed in retail and wholesale

68.60.10.3

10.8

0.1 5.1

3.50.8

0.40.4

0.5

13.8 1.1 1.81.6

AgricultureFishingMining and quarryingManufacturingElectricity, gas and water supplyConstructionWholesale and retail tradeHotels and restaurantsTransportFinancial intermediationReal estatePublic administrationEducation Health and social workOther community workActivities of private households Extraterritorial organi-zations and bodies

5

Source : NSSO, 2009-2010

Where women are employed ?

FDI Restriction

s?

• Majority as skilled agriculture and fishery workers.

• Very low percentage of service and sales workers

• Employment in elementary occupations such as mining, construction and basic manufacturing is high

6

Source : NSSO, 2009-2010

What women are employed as?

2.632.513.06

1.073.62

40.36

8.550.770000000000002

37.1

0.06

Legislators, Senior Officials

Professionals

Technicians and Associate Pro-fessionals

Clerks

Service Workers and Sales Workers

Skilled Agricultural and Fishery Workers

Craft and related Trades Workers

Machine Operators and Assemblers

Elementary Occupations

Workers not Classified

• SECTOR WISE FDI• STATE WISE FDI• LINK BETWEEN FDI AND EMPLOYMENT

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Understanding the FDI dynamics and its link to women employment

Sector wise FDI in India8

Source : DIPP, 2012

State wise distribution of FDI in India (%)

9

Source : DIPP, 2012

Maha,

Dadra

,Dam

an

Delhi,U

P and H

ar

Karna

taka

TN, P

ondic

herry

Gujara

t AP

Kerala

, Lak

shad

weep

W B, S

ikkim

, And

aman

UP, Uttr

anch

al

Chand

igarh

, Pun

jab, H

arya

na, H

P

MP, Cha

ttisg

arh

Goa

Rajasth

an

Orissa

Bihar,

Jhark

hand

7 N.E st

ates

0.0

5.0

10.0

15.0

20.0

25.0

30.0

Urban Women Employment(2009-10) in States with High FDI Inflows (%)

10

Himac

hal

Chhatt

isgar

h

Andh

ra Pra

desh

Mizora

m

Megha

laya

SikkimTa

mil

Karna

taka

Arun

acha

l Pra

desh

Mahar

ashtr

aMP

Pudu

cher

ry

Uttara

khan

d

Kerala

A and

N Is

land

Rajasth

an

Gujara

t

Laks

hadw

eep

Nagala

nd

Manipu

r

Orissa

Chand

igarh

Tripu

ra

Daman

Assa

m

Harya

na

Jhark

hand Goa WB UP

Jammu K

ashm

ir

Punja

bDelh

iBiha

r

Dadra

and N

agar

Hav

eli0

5

10

15

20

25

30

35

40

45

2321

25

42

35

22

2725

22 2117

29

14

32 32

13

19

28

14

19

15

21

26

13 1317

1416 17

9

1713

86

3

Source : NSSO, 2009-2010

Many other factors (culture, education, government policy, etc.) determine women employment other than FDI

Sectors that attract women employment

Direct Selling: A New Retail Format

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Size : The size of direct selling industry in India is abour 901 USD million (2010) which is higher than countries like Singapore and Indonesia and is ranked 11th world wide Women: The share of women in this sector is more than 50 % (IDSA, 2011)Benefits: • According to a survey by ICRIER, about 68 %

women feel it builds self esteem, 69 report financial independence and higher earnings, flexible timings and improved and ability to take care of families. (ICRIER research, 2011)

Initiatives by various companies : Tupperware is leveraging a growing female sales force of 2.6 million women in regions like China, India, Indonesia, the CIS, Latin America and South Africa.- 99% sales person are women over all the world

Treated as wholesale trade for FDI inflows- No FDI restrictions

IT Services12

• Size : The Indian IT-BPO industry has emerged as the largest private sector employer in the country with direct employment of about 2.23 million professionals. The sector employ 30-35% women (NASSCOM , 2012)

• Factors : The important factors that encourage women workforce to participate in IT sector is

• comparatively high salary, • easy international mobility, • gender-neutral policy based on

knowledge-centric skills possession, • flexible work routine and physically

less demanding work process in comfortable indoor work- environment (Kumar 2001; Upadhya 2006; Shanker 2008).

• Representation : Senior management have only 5 % representation.

• Initiatives : like Shakti (a women well being initiative) by a BPO called Ajuba, has made it more lucrative for women to work in this sector

Open to foreign investment with limited regulations and high incentives to FDI

Why international companies employ women?

Problems employing women in India

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Opportunities and challenges

• Huge Untapped Women Workers : India is at par, if opportunities availed, with her immediate competitors for the use of women workforce as most Asian countries, including China, Singapore, Malaysia, Korea and Taiwan, have huge women labour force

• More Productive :Employers perceive women as more “productive” in the types of jobs available in the export sector

• They are obedient and • less prone to worker unrest• suited to tedious work• reliability and trainability relative to

men

• Indian Labour Laws : In 2007, the factory act 1948 section 66 was amended, allowing women to work between 10 pm and 6 am, is benefiting those working in Special Economic Zones (SEZs), textiles, garments, handicrafts, leather and IT sector.

• Skills : As Indian women do complete minimum education and even if they get educated their access to English language remains very limited hence it MNCs find it difficult to employ women

• Security : The crime rate in India is high owing to which extra money is spend on ensuring security by providing cabs and security for women working late at night

• Conservative Mindset : Women in India don’t work majorly due to this mindset of their families

• Working Hours : Women in India are homemakers even if they are working hence this requires them to have flexible working hours to manage their homes and office responsibilities

• Labour Regulations: Centre versus states, variation across states

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THANK YOU

F O R D E TA I L S C O N TA C T :

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