Role of Women Workforce in Achieving $30 Trillion Economy by 2047 India aspires to be a $30 trillion economy by FY47 and women employment plays a crucial role in achieving this goal

India's spinning wheel of economic growth needs the strong hands of employment to keep it rolling. While the economic growth has had some positive impact on the country's labour market conditions, it has not led to a radical structural transformation in employment conditions. There has been a slow, although steady, decline in the share of agriculture and a rise in the share of services in total employment – the share of agriculture fell from 60 per cent in 2000 to around 42 per cent in 2019. This shift has been largely absorbed by construction and services, the share of which in total employment increased from 23 per cent in 2000 to 32 per cent in 2019, as per a report by International Labour Organization (ILO). The share of manufacturing has remained almost stagnant, at around 12–14 per cent.

The/Nudge Institute has unveiled a new report, 'Labour Force Participation Distillation Report', outlining a crucial element for India's economic future. The report is based upon the 'Periodic Labour Force Survey' (PLFS) over the years. The report sheds light on India aiming to become a $30 trillion economy with women labour playing a vital role in it.

"The role of women in driving India's economic engine is increasingly coming to the forefront, yet there remains an untapped reservoir of potential that could significantly bolster the nation's growth. Presently, women contribute a modest 18 per cent to India's GDP, a figure that, while notable, reflects both the significant contributions women make and the vast opportunities that still exist to enhance their participation in the workforce. Women-led enterprises, which account for approximately 15-16 million businesses, are pivotal in generating employment for 26-29 million individuals, showcasing the substantial impact of women entrepreneurs on job creation and economic expansion. However, despite these contributions, women represent only 24 per cent of India's workforce, starkly contrasting their 48 per cent share of the population. The Labour Force Participation Rate (LFPR) for women has gradually increased, rising from 23.2 per cent in Q2 FY23 to 24 per cent in Q2 FY24 and, even more significantly, from 23.3 per cent in FY17-18 to 37 per cent in FY22-23," stated Sumit Kumar, chief strategy officer at TeamLease Degree Apprenticeship.

To boost women's representation in the workforce, a comprehensive strategy is needed, emphasising education, skill development and the removal of systemic barriers. Work-integrated learning, through apprenticeships, internships and degree programs, plays a pivotal role in equipping women with practical skills and industry-specific knowledge, particularly in underrepresented fields like technology, manufacturing and skilled trades. Flexible work arrangements, supportive policies such as childcare and parental leave, and targeted educational investments are also essential. By expanding access to these opportunities, women's increased participation will drive economic growth and create a more inclusive and equitable society.

A common gender norm is the "male breadwinner" norm, which means, husbands are considered the primary earners with wives contributing to household income only if necessary. The PLFS data shows that in households where the husband's earnings are high, the probability of the wife being employed is low, controlling for individual and household factors. The fall slows down as husband's incomes increase in rural India, while for urban areas, there is a reversal beyond a certain level of income. As husband's earnings keep rising, from approximately INR 40,000 per month onwards, there is an increased likelihood of wives being employed. This U-shaped pattern could result from a change in norms with rising incomes or it could also be due to the fact that such husbands are matched with higher educated wives who have preferences as well as opportunities to access better paid work.

"The urgency for increasing women's representation in India's workforce stems from both the untapped potential they represent and the critical role they play in driving sustainable economic growth. With a workforce of over 500 million, the fact that only 158 million are women highlights a significant gender imbalance that restricts the nation's economic capabilities. To fully harness the power of its female population, India must integrate an additional 400 million women into the workforce, which could contribute a staggering $14 trillion to the economy by fiscal year 2047. However, with current projections indicating that only 110 million women are expected to join the labour force by then, an additional 145 million women need to be brought into the fold. The economic implications of such a shift are monumental—boosting GDP growth by 9-10 per cent annually—if women, who make up 48 per cent of the population, are more actively engaged in non-farm labour," concluded Sumit.

In urban India, 60 per cent of single women aged 25-29 participate in the labour force, while only 20 per cent of their married peers do, despite similar education levels. Notably, a third of housewives express interest in working, highlighting an untapped workforce. Women own just 20 per cent of all enterprises, with 82 per cent operating as sole proprietorship micro-units primarily in the informal sector. Although the government classifies enterprises into micro, small, medium, and large, a new category—nano enterprises—is emerging. These nano businesses, often home-based or roadside, involve low-cost transactions and are predominantly run by women.