The International Monetary Fund (IMF) estimates that equal participation of women in the workforce will increase India’s GDP manifold. A McKinsey Global Institute study calculated that the economic impact of achieving gender equality in India is estimated to be US $700 billion of added GDP by the year 2025.
Yet the participation of women in India’s workforce has been abysmal and is one of the lowest in the world. Women’s participation in India’s workforce stands at under 28%. According to the Global Gender Gap report released by the World Economic Forum (WEF) in 2017, which ranks countries on parameters of gender equality in health, education, economics, and politics, India finished 139 out of 144 countries on economic participation and opportunity. Despite managing to bridge the gender gap in enrolment in primary and tertiary education, India ranked 112 on the education attainment metric. Overall, India ranked 108 out of 144 countries.
Why is India leaving its women behind? Do Indian women self-select themselves into unfavourable career choices as adults, given their primary responsibility of caring for children and running the household? Is it that women who focus on pursuing professional careers cannot maintain a work-family balance as costs of child care increase and there are few alternative part-time employment options? Do women opt out of formal employment?
Researchers Amit Jain Chauradia, Chandrasekhar Sripada and Glory George investigated the career choices of women, within the context of the short-term skill development training activities of Pradhan Mantri Kaushal Vikas Yojana (PMKVY). These researchers conducted an ethnographic study to understand the PMKVY ecosystem and the importance of key constructs such as gender and placement. To understand the nuances behind the ‘skills-to-jobs conundrum’ in India, they further analysed a large dataset with over a million observations.
Impact with skill development?
Inadequate training infrastructure, outdated curricula and stigma towards the vocational education system have long jinxed the skill development ecosystem in India. Long-term training programmes for teaching industrial trades are unpopular. They have high dropout rates and diminishing enrolment. To remedy this state of affairs, the Ministry of Skill Development and Entrepreneurship was created to provide skill development and entrepreneurship programmes through a streamlined institutional mechanism.
Often in developing economies, government-sponsored training programmes act as tools for integrating the unemployed and economically disadvantaged into the mainstream workforce. These programmes allow beneficiaries sufficient time to move through basic education and job training to obtain occupational certificates. On the other end of the institutional spectrum, they offer incentives to entities that provide support to such programmes.
The researchers found that PMKVY, the skill development programme bridged the gap between the workforce and the skills required in a job. Students who underwent training developed the required knowledge and skills to help them find suitable employment. Apart from the technical skills acquired, the life-skills training made the students more confident and self-reliant to pursue employment opportunities.
A key discovery from this research is the transition of women into self-employment after completing the training programme. Prior research has attributed women’s entry into entrepreneurship to either individual or situational factors. Women who opt for self-employment often cite the flexibility of working hours, lack of institutional resources to cover the costs of child care and work-life balance as reasons to enter an entrepreneurial domain.
This research is the first study to document an underlying institutional factor impacting the transition of women into self-employment. The researchers found the choice of placement – self-vis-à-vis wage-employment– was positively moderated by female vis-à-vis male trainers who taught in the training programme. Male trainers are more likely to help their students get placed in wage vis-à-vis self-employment while female trainers are more likely to help their students get placed in self-employment rather than wage-employment. Anecdotal evidence from the ethnographic study shows that male trainers are more likely to impart work-readiness skills while female trainers are more likely to impart nurturance skills along with advice on building an enterprise.
Same job, different pay?
Researchers Chauradia, Sripada and George point to the existence of deep-rooted gendered stereotypes in India. The researchers found that women with higher grades are less likely to get placed in wage-employment vis-à-vis men with lower grades. Such discrimination based on gender stereotypes is not always intentional. It often is due to the mismatch between the perceived masculine occupational qualifications and feminine stereotypes about women. The ‘lack of fit’ perception between women and competence that results in women being penalized for achievement. Women are stereotyped as “nice but incompetent” whereas men are stereotyped as “competent but maybe not so nice”.
The researchers also tested to see if there was a difference in what men and women earn for the same job role. They found that women earned 3% lesser than men for the same job role. A complicated mix of latent gender bias and occupational segregation of women result in an inescapable cycle of lower earnings for women.
The Diversity Dividend?
Women’s careers often reflect strong cultural beliefs and attitudes surrounding gender and gender roles. What can policymakers do to change some of these gendered outcomes?
The researchers’ prescription is clear. From a public policy perspective, the government must be focused on creating an ecosystem to promote equal opportunity for women. Currently, only a small proportion of India’s women has access to resources that can provide them with sustainable livelihoods. Training programmes such as the PMKVY act as catalysts in bringing more women into the workforce by offering industry-specific training and offering women much-needed access to good quality, better-paid jobs and self-employment opportunities.
As more women qualify to join the workplace, the skill portfolio of the labour force changes. That in turn increases the competitiveness of the labour market and gives more options to employers to choose from a larger and more qualified pool of human capital.
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Amit Jain Chauradia is Assistant Professor of Strategy at the Indian School of Business.
Chandrasekhar Sripada is Clinical Professor of Organisational Behaviour and Strategic Human Capital at the Indian School of Business.
Glory George is a Research Associate at the Indian School of Business.
About the Research:
Chauradia AJ, Sripada C, George G. (2018). Confronting India’s Skill Development Paradox: Human Capital Challenges of Gender and Job. Working Paper, Indian School of Business.
About the Researcher:
Glory George is a Research Associate at the Indian School of Business.