The Global Gender Gap Report 2025, released by the World Economic Forum earlier this month, ranks India at 131 out of 148 countries on its Gender Gap Index. The gender differential in the labour force participation rate (LFPR), or the share of the population that is working or actively seeking work, is one of the metrics it considers for the report. For India, it shows this at 76.4% for males and 35.1% for females, or a differential of 41.3 percentage points. Over the last decade, government data shows greater participation by women in the labour force, but the quality of work—and, by extension, earnings—remains a concern.

India’s female LFPR has been lower, whether compared with neighbours like Sri Lanka or with fast-growing countries in Asia, or with developed regions. The LFPR of poorer countries such as Bangladesh has risen above India’s in recent years. At the same time, India’s female LFPR has increased in recent years.

The increase is more in rural areas as compared to urban areas. Over the last decade or so, one of the weakest aspects of India’s labour market seemed to be finally showing signs of improvement. The proportion of the female population that is engaged in work other than domestic and home care began to rise. For a segment of the population that, to date, had been largely engaged in unpaid domestic work, this was a potentially major step. But underlying the rise in female participation in the labour market are deeper concerns about the quality of work being generated, and how it is being captured.

Work without money

In terms of type of employment, the biggest rise in women workers has been of self-employed workers. This covers a wide range of incomes and economic classes—from women running their own companies to those who run a kirana shop. Crucially, the self-employed segment now also includes women who do unpaid work in household enterprises—for example, in a family-owned kirana shop—raising questions over the quality of employment.

Self-employed women in these two categories accounted for about 66% of women workers in 2023-24, as compared to about 49% in 2017-18. In contrast, the number of women who are salaried has risen in absolute terms by around 10 million during this period. However, the share of the salaried among women workers has fallen by around 5.5 percentage points—from 24.3% in 2017-18 to 18.7% in 2023-24.

Salary perks

While self-employment is often praised in terms of female entrepreneurship, the reality is that the vast majority of self-employment, especially for women, is of low quality in terms of earnings. In 2023-24, average monthly earnings of self-employed women were lower than even those women workers who work in casual labour, and much lower than women who work as salaried employees.

Irrespective of gender, it is salaried employees who earn the most among the three categories of workers. The reality of ‘entrepreneurship’, for both men and women, is one of highly insecure, low-paying work—for example, running a small shop or engaging in piece work. In the current ‘gig’ economy, even those who act as couriers or food delivery workers are considered ‘self-employed’. In general, they are not covered by even minimal labour legislation. In contrast, even a low-end salaried job tends to pay more.

State of decline

In 2023-24, only 18.7% women workers were salaried. This figure exceeds 30% in only eight states or Union territories: in descending order of share, Chandigarh, Delhi, Puducherry, Goa, Kerala, Punjab, Haryana, and Tamil Nadu. At the other end, there are two populous, but poorer northern states, namely Bihar (5.5%) and Uttar Pradesh (7.9%).

Bihar and Uttar Pradesh are also among the 22 states that have seen the share of salaried among women workers decline between 2017-18 and 2023-24. Even in an affluent state like Delhi, the decline in women in salaried jobs has been 7 percentage points. States and Union territories that have seen an increase in the proportion of salaried women are Chandigarh, Andhra Pradesh, Goa and Haryana. The big challenge in the labour market facing the government is to accelerate not just absolute numbers, but also the share of higher-quality jobs. Salaried jobs may be boring, but they are better than the alternatives for now, at least.

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