Expert Speak India Matters
Published on Jan 04, 2022 Updated 18 Days ago
As women bear the brunt of the rising income inequality, the need for a positive policy change has become even more pronounced
 Trickle-down Wage: Analysing Indian inequality from a gender lens

The World Inequality Report 2022 brought to the fore the most pressing concerns on wealth and income inequalities across the globe. The report builds on the work of more than 100 researchers, maintained by the World Inequality Lab and collaborates with a rich and vast network of universities, statistical institutions, tax authorities, and international institutions to bring about analytical data on international inequality. While the report provides an informed insight into the narrative of the ‘rich get richer’ for the sake of aiding the democratic debate, it also provides insights on dissecting the major income and wealth concentration levels on a socio-economic basis.

The South Asian picture 

The pandemic has exposed and fed off the profound socio-economic inequalities of the existing world. It took only nine months for billionaires to reach their pre-pandemic income highs while for the world’s poorest, it might take up to a decade to undo the economic slowdown, reports Oxfam’s Inequality Virus Global Report 2021. Today, South Asia stands amongst the most unequal geographical regions of the world. Since the pandemic, it has become one of the five most affected regions of the world as these economies are heavily dependent on contact intensive and unorganised sectors bearing an uneven burden of job losses and, of course, widespread socio-economic disparity. “Millions of people in South Asia are being pushed into extreme poverty as the region where a quarter of humanity lives suffers its worst ever recession due to the devastating impact of the Coronavirus pandemic,” reports the World Bank.

South Asia stands amongst the most unequal geographical regions of the world. Since the pandemic, it has become one of the five most affected regions of the world as these economies are heavily dependent on contact intensive and unorganised sectors bearing an uneven burden of job losses and, of course, widespread socio-economic disparity.

India’s position today is described as “most extreme cases of wealth and income inequality in the world” and can be termed more of a political choice rather than an inevitability inherited from liberal policies of a deregulated economy since the 1990s. But these policies have affected demographics differently even within countries. The statistics from the report suggest, the top 10 percent of the population earns almost 20 times more than the bottom 50 percent. While the bottom 50 percent has a declining share of 13 percent in total, the top 1 percent is earning 22 percent of the total national income. “India, hence, stands out as a poor and very unequal country, with an affluent elite.” Gender-based discrimination, being an important dimension of socio-economic inequality has had adverse economic outcomes for women in these unprecedented times. Women are 10 percent more likely to be living in extreme poverty in India by 2021 in comparison to men cites the UN Women Report of 2020. Though ‘women’ would encompass a wide array of people from varying socio-economic, cultural, and geographical backgrounds with varying levels of access and are not a monolithic identity, the pandemic disrupted an already skewed ratio in educational opportunities, access to finance, wage disparities, and other social constraints for them demographically.

Gender inequalities and shares in labour income

Gender inequality is one of the oldest and most pervasive forms of inequality in the world and as a result, social and economic impacts of the COVID-19 pandemic have been far from gender neutral. The Inequality Report spearheads a critical approach in income and wealth levels by furnishing first global estimates of gender inequality observed in global earnings. It takes into account income disparities as basic as the gender wage gap to female labour income shares across the world through the years 1990–2020. While there is a great deal of literature present on the Gender Wage Gap, overall shares of labour income accruing to women and men provide a much clearer picture into the systemic inequalities within a country; it measures women’s comparative access and retention in labour markets in comparison to men in a particular country. India’s numbers here stand at a grim 18 percent and are amongst the lowest in Asia’s average at 27 percent, ahead of only Pakistan and Afghanistan, both of which fall under 10 percent. The Asia Foundation Report suggests a trend wherein fewer South Asian women are working for longer hours for lower pay, compared to their male counterparts.

The pandemic has unleashed a multi-dimensional negative impact on the economic stability and resilience of vulnerable and marginalised social groups such as women, more so in developing economies with socio-cultural backgrounds that tend to hinder women’s entry and participation in labour markets. India’s battle for gender parity is an uphill climb and is progressing slowly as resounded by the World Economic Forum’s Global Gender Gap Report of 2021, which places India amongst countries with the largest Gender Gaps in Economic participation and opportunity due to an observed declining trend from 27 percent in 2010 to 22 percent in 2020 in Female Labour Force Participation. Azim Premji’s State of Working India Report 2021 paints a realistic picture of the gendered aspect of working India, “During the lockdown and months after, while 61 percent of men remained employed and only 7 percent lost employment, only 19 percent women remained employed and a vast 47 percent suffered a permanent job loss.”

India’s battle for gender parity is an uphill climb and is progressing slowly as resounded by the World Economic Forum’s Global Gender Gap Report of 2021, which places India amongst countries with the largest Gender Gaps in Economic participation and opportunity due to an observed declining trend from 27 percent in 2010 to 22 percent in 2020 in Female Labour Force Participation.

According to the Inequality Report 2022, while women represent about 50 percent of the population, they earn only about one-third of the labour income for it. Those who do step into the workforce are often offered work in the informal sector, which categorically provides no protection of labour laws, or social benefits like pension, paid sick leave, maternity leave. Informal sector rarely provides any resilience against market fluctuations; this makes them more vulnerable and keeps them in poverty and altogether wary of potentially entering the workforce. While men moved to the informal workforce during lack of better opportunities, women quit the workforce altogether due to increased burden of the household and an acute lack of safety nets.

Unpaid care work, patriarchal social norms, and other factors

The gender-based disparities are high, both within and across countries due to income differentials, the type of occupations women are engaged in as well as cultural barriers to women’s work. The factors contributing to this declining trend are ample and diverse. Going by time use surveys, women spend almost twice as much time providing unpaid care work such as cleaning, cooking, providing care to the elderly, fetching water, childcare, etc. “Women across different regions and cultures and classes spend an important part of their day on meeting the expectations of their domestic and reproductive roles.” Women are, thus, under the “double burden” of performing paid and unpaid labour. According to statistics presented by the OECD Center, the wealth a country possesses has a negative correlation to the gender inequality in unpaid care work. The social norm of gendered differentiation of labour, thus, makes it harder for women to enter and remain in the labour market. The conundrum of unpaid care work is only increasing in India given the shrinking family sizes and resulting time poverty faced disproportionately by women. The Deloitte Global Survey Women @ Work states only 39 percent women worldwide feel that their employers are doing enough to support women at the workplace since the pandemic; the numbers are even lower for LGBTQ+ women.

According to the  Azim Premji University's report “State of Working India” the imposition of lockdowns, has affected the feminised sectors, such as the care economy and the gig economy, much more severely than the sectors in which men are over represented. Only 19 percent of women were able to continue their employment while a vast 47 percent faced a job loss permanently. The Global Gender Gap Report 2021 describes the concept of ‘Labour Market scarring’ in which temporary limitation of in-person work has caused permanent and long-lasting effects on women’s chances at decent employment in future.

Women continue to deal with non-inclusive behaviour even in the virtual workplace. More than half of the respondents have reported ‘microaggressions’ or some form of ‘harassment’ cites Deloitte’s Women @ Work Report. Fifty-one percent feel less optimistic about their future career prospects.

The Global Gender Gap Report 2021 describes the concept of ‘Labour Market scarring’ in which temporary limitation of in-person work has caused permanent and long-lasting effects on women’s chances at decent employment in future. 

It would be hard to dismiss that South Asia is hardest hit by these factors due to the prevailing social and cultural norms around women’s work, aggravated by factors such as harassment and violence at public spaces or during commute to the workspace. Women’s interactions are severely limited and basic social and economic freedoms are curbed, thereby, affecting their agency. Meanwhile, the Delloitte Global Survey suggests LGBT+ women are much more likely to have experienced jokes of a sexual nature in a workplace.

Gaps and the road to recovery 

India has evolved to become a strong regional and political player in shaping the developmental policies for not just South Asia but the whole of the Global South. The Inequality Report 2022 has unearthed a crucial bolt in India’s machinery, by addressing its socio-economic shortcomings.  Though it is true for most South Asian nations as well, women have been kept at the lower end of wealth and income brackets. Through various practices, be it discriminatory policies and social structures, lack of access to lucrative jobs and labour market or the double bind of performing both paid and unpaid labour, women have only been earning a third of the labour they have promise for. Without adequate focus on policy change, India faces a threat of leaving behind a half of its population in this road to recovery, not to mention bear the brunt of inequalities even further. We need to revisit the labour distribution in our country and rethink formal and informal structures at a policy level. There is a need to enhance the social security mechanisms for informal workers with a special focus on women. Upskilling women for ‘hard professions’ and adopting a ‘care lens’ is hence essential for defeminising care work and would contribute to redistributing it equally amongst family members irrespective of their gender. It obviously is also important to create gender sensitive fiscal policies and educate the masses about the criticality of rising inequalities and formulate a framework of labour laws to sustain in the neoliberal world.

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Contributor

Avni Arora

Avni Arora

Avni Arora was a Research Assistant with the Center for New Economic Diplomacy at ORF. Her key areas of research are Gender Development Policy and ...

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