Why the number of women in the Indian workforce is stagnating despite inclusive initiatives

Women made up 18 percent of India’s workforce in fiscal 2024, a slight decline (0.6 percent) from the previous year and no difference from the fiscal year 2021, where their representation was 19 percent.

The figures indicating this stagnation come from the Women’s Formal Employment Tracker by women’s economic empowerment organization Udaiti Foundation, which studies data from the top 2,000 companies in 25 sectors listed on the National Stock Exchange (NSE). These data raise concerns given that women graduates now represent almost half of the total number of students enrolled in higher education in the country.

Smita Shetty Kapoor, CEO and co-founder of diversity and inclusion consultancy KelpHR, cites cultural and social barriers as key determinants of women’s ability to work. “Responsibilities related to caring for children, the elderly and households are still considered the main tasks of women. So, as more and more women graduate, managing all of these responsibilities at the same time as a full-time job is like having two full-time roles. This leads to women dropping out of the workforce,” says Kapoor.

Kapoor adds that it is essential for women to prioritize their financial independence. Additionally, men must step up and share caregiving responsibilities to ensure that a marriage is an equal partnership with similar opportunities for both spouses. Only then will there be greater participation of women in the labor market, she says.

A positive trend is that women’s participation is increasing in certain sectors, even if these are traditionally dominated by women, such as hospitals and diagnostic laboratories (41 percent), information technology (34 percent ) and banks (26 percent). , among others.

Furthermore, women continue to be underrepresented in sectors such as oil and gas, pharmaceuticals and capital goods due to factors such as inadequate training and employment requirements, mobility restrictions and lack of supportive working environments.

“Several cultural norms regarding gender roles and responsibilities, as well as safety concerns, often restrict women’s ability to relocate for employment, thereby limiting their access to various employment opportunities,” says Pooja Sharma Goyal, Founding CEO from the Udaiti Foundation.

Goyal adds that traditionally male-dominated sectors often lack supportive policies, such as flexible working hours, childcare and safe transportation, which fail to attract women to join these companies. “This, coupled with skills mismatch and limited employer engagement in female-dominated professional occupations, reinforces occupational segregation and restricts women’s access to formal jobs,” says Goyal.

Another reason is that most large companies in sectors such as FMCG (fast moving consumer goods), banking and healthcare have higher female participation.

Data from the Udaiti Foundation’s Close the Gender Gap report shows that companies with fewer than 500 employees have about 15 percent women, while large companies (20,000 employees or more) have about 25 percent women. This could be due to the increasing emphasis on diverse hiring in these sectors and, in some cases, the nature of the positions held.

For example, companies now have DEI (diversity, equity and inclusion) initiatives regarding front-line workers, such as sales and medical representatives, and women on the shop floor, in dark stores and in warehouses. Organizations are offering flexible work schedules, field relief kits, enhanced safety measures and other initiatives.

Large companies have managed to retain women through mentoring programs or by offering second career programs for those who were on a work break and want to return. This could be difficult for smaller businesses, such as MSMEs and start-ups, to emulate and achieve due to a lack of organizational capacity, again leading to lower representation of women in these sectors. Therefore, while businesses must create an overall environment to hire and retain women, it is also necessary to overcome societal, gender and cultural norms to ensure that the full potential of women in the economy is realized.

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