• India holds significant position with regards to the global economic growth and structural transformation story. But the asymmetries are still abound (exist in large numbers) in the country’s labour market.
• A commensurate improvement in its labour market outcomes and a fair distribution of the fruits of economic progress will spur further economic growth and the benefits it brings.

Background

• The Third International Equal Pay Day 2022 was observed on 18 September
• The symbolic day aims at highlighting issues and raising worldwide awareness to put an end to the history of gender discrimination that women are generally subjected to by getting paid less than their male counterparts.

Impact of the pandemic

• While the full impact of the pandemic is yet to be known, it is clear that its impact has been uneven, with women being among the worst affected in terms of their income security.
• This is partly due to their representation in sectors hard hit by COVID-19, combined with the gendered division of family responsibilities.
• Many women reverted to full-time care of children and the elderly during the pandemic, foregoing their livelihoods to do so.

Statistics

• A wider pay gap: The International Labour Organization’s (ILO) “Global Wage Report 2020–21” suggests that Covid-19 crisis inflicted massive downward pressure on wages.
• The COVID-19 pandemic had a disproportionate effect on women workers in terms of job and income losses which indicates that the pre-existing gender pay gap has widened.
• Back pedaling progress: The preliminary estimates from the Periodic Labour Force Survey (PLFS) 2020-21 show an increase in the gap by 7% between 2018-19 and 2020-21 owing to pandemic.
• The data further suggests that faster decline in female wages during the pandemic contributed to this gap, compared to a faster growth in male wages.
• Behind global standards: Despite notable progress in closing the gender pay gap over time in India, the gap remains high by international standards.
• Indian women earned, on an average, 48% less compared to their male counterparts in 1993-94.
• The gap declined to 28% in 2018-19 as in the labour force survey data of then National Sample Survey Office (NSSO).

Discrimination as factor

• Globally, women on average, are paid about 20 per cent less than men. Though the gender pay gap is vastly attributed purely to discrimination based on one’s gender or sex, though individual characteristics such as education, skills or experience also play a part.
• The Gender-based discriminatory practices include the following:
• Lower wages paid to women for work of equal value
• Undervaluation of women’s work in highly feminised occupations and enterprises,
• Motherhood pay gap, i.e. lower wages for mothers compared to non-mothers.

Steps to address gender inequality

• International level: The United Nations has put the challenge of closing various forms of gender inequality at the heart of its actions.
• The ILO has enshrined ‘equal pay for work of equal value’ in its Constitution
• The Convention on the Elimination of All Forms of Discrimination against Women (CEDAW) provides an international legal framework for realising gender equality and addressing the intersecting forms of discrimination and vulnerabilities among women and girls.
• Sustainable Development Goals: One of the targets of the UN SDG 8 is “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 support of this Goal, the Equal Pay International Coalition (EPIC) was launched in 2017 as a multi-stakeholder initiative led by the ILO, UN Women and the Organisation for Economic Co-operation and Development (OECD) that seeks to achieve equal pay for women and men everywhere.

Indian strategy

• Legislative actions: To close the gender pay gap, especially at the low-end of the wage distribution, India was one of the pioneering countries to enact the Minimum Wages Act in 1948 followed by adoption of the Equal Remuneration Act in 1976.
• In 2019, India carried out comprehensive reforms in both the above legislations and enacted the Code on Wages.
• Policy initiatives: As per evidence, the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in 2005 benefited rural women workers and helped reduce the gender pay gap, both directly and indirectly.
• Directly by raising the pay levels of women workers who participated in the programme
• Indirectly benefits accrued to women involved in agricultural occupations through higher earnings, as MGNREGA contributed to the rapid rise in overall rural and agricultural wages in the country.
• Maternity Benefit (Amendment) Act: In 2017, the Government amended the Maternity Benefit Act of 1961, which increased the ‘maternity leave with pay protection’ from 12 weeks to 26 weeks for first two children for all women working in establishments employing 10 or more workers.
• This is expected to reduce the motherhood pay gap among mothers in the median and high-end wage earners working in the formal economy.
• Government schemes: The efforts are being made through the Skill India Mission to equip women with market-relevant skills to bridge the learning-to-livelihood gap and the gender pay gap.

Looking ahead

• The full and productive economic growth requires a human-centred recovery from the pandemic, which will be made possible by improving women’s employment outcomes and reducing the gender pay gap.
• While the gender pay gap is slowly narrowing, at the current rate of progress it will take more than 70 years to close it completely.
• Accelerated and bold action is needed to prevent a widening of the gender pay gap and closing the existing gap. Equal pay for work of equal value is key to achieving social justice for working women, as well as economic growth for the nation as a whole.