[Editorial] Gender Pay Gap

While India is noted for its structural transformation story, asymmetries affect the labour market- not a surprise given the country’s size and diversity. Following the outbreak of the pandemic, these disparities have worsened. In this context, Third International Equal Pay Day observed on September 18th 2022, to create awareness about the importance of gender parity in pay, takes on a special significance.

How wide is the gender pay gap in India?

  • According to the World Economic Forum’s gender parity rankings, India stands at the 135th spot out of 146 countries. This is just 11 ranks ahead of Taliban-ruled Afghanistan, where women aren’t allowed to even attend schools. This is worrying given how India ranked at the 87th spot just 6 years ago (2016).
  • The WEF says that it could take nearly 200 years for the larger South Asian region to close the existing gender gap.
  • While India’s gender pay gap is high compared to international levels, there has been notable progress in reducing the disparity. On an average, women earned 48% less than their male counterparts in 1993-94. This gap had reduced to 28% in 2018-19, according to National Sample Survey Office’s labour force survey data.
  • However, decades of progress has been reversed by the pandemic situation. Preliminary estimates from the Periodic Labour Force Survey 2020-21 shows a 7% increase in gender pay gap between 2018-19 and 2020-21.
  • The data suggests that this widening of the gap was caused by a faster decline in women’s wages rather than a faster increase in men’s wages. Women enjoyed significantly lesser pay hikes and bonuses during the pandemic.
  • ILO’s Global Wage Report 2020-21 also attested to this rising disparity. It suggested that the pandemic had inflicted a massive downward pressure on wages– which disproportionately affected women employees.

Why is the gap widening?

  • Individual characteristics that contribute to the gender pay gap include education, experience and skills. However, a significant part of the gap can be attributed purely to gender discrimination.
  • Gender based discriminatory practices include:
    • Lower wages paid for work of equal value
    • Undervaluation of work in enterprises and occupations that are mainly women-dominated
    • Motherhood pay gap
    • Lower wages for mothers compared to non-mothers
  • The pandemic has had a disproportionate effect on women employees in terms of income and job losses. This because of
    • Their high representation in sectors that were the worst hit by the pandemic
    • The gendered division of family responsibilities
      • Child care
      • Care of the elderly (especially vulnerable to COViD-19), etc.

What steps have been taken?

  • Legislative measures to tackle gender pay gap, especially at the lower end of the wage spectrum:
    • Minimum Wages Act in 1948
    • Equal Remuneration Act in 1976
    • Code on Wages
  • MGNREGS has benefited women in rural India and contributed to reducing the pay gap-
    • Directly- by pay of women workers participating in the program
    • Indirectly- by MGNREGS-driven rapid increase in overall rural and agricultural wages, benefiting women engaged in agriculture
  • Maternity Benefit Act, 1961, was amended in 2017 to increase maternity leave (with pay protection) from 12 weeks to 26 weeks for women employed in establishments with 10 or more workers. This is benefiting mothers in median and high-end wage categories of the formal sector.
  • Market relevant skills are being imparted to women via Skill India Mission.
  • UN SDG 8 talks about achieving “full and productive employment and decent work for all women and men, including for young people and persons with disabilities and equal pay for work of equal value” by 2030. In line with this, EPIC/ Equal Pay International Coalition, a multi-stakeholder initiative involving ILO, OECD and UN Women, was launched in 2017.
  • The CEDAW (Convention on the Elimination of All Forms of Discrimination against Women) gives an international legal framework for addressing gender discrimination and realizing gender equality.

What needs to be done?

  • To achieve productive and equitable economic growth, a human-centric recovery plan is needed. Reducing gender pay gap and improving women’s employment outcomes would help here.
  • At the current rate, it would take over 70 years to close the gender pay gap. To prevent the widening and eventually, the closing of the gender pay gap, accelerated and bold action is needed.
  • Some steps that could help close the gap include:
    • Hiring more women in different posts
    • Creating career enables to help retain women in the workforce
    • Periodic gender-based review of pay data to check for disparity
    • Checking for conscious and unconscious biases, especially at the higher levels of work hierarchy
  • In addition to these measures, global collective commitment is needed to achieve the ‘equal pay for work of equal value’ principle, enshrined in ILO’s Constitution.

Conclusion:

To close the gender pay gap, the ‘equal pay for equal work’ principle must be kept at the core. Closing the gap is vital in achieving social justice for women and economic growth for the country.

Practice Question for Mains:

Discuss the factors contributing to the gender pay gap in India. What are the efforts taken to address it and what more needs to be done? (250 words)

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