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MARCH 2026

On the demand side, India’s labour market has struggled to
generate sufficient employment opportunities that align Gender-Responsive
with women’s skills and aspirations. The scarcity of suitable Infrastructure
jobs - particularly in the formal and organised sectors -
combined with persistent gender pay gaps, discourages Physical and social infrastructure must be designed with
educated women from entering or remaining in the women’s needs in mind. An ILO report notes that over 53
workforce. For instance, rising gender wage disparities are per cent of women outside the labour force cite care
estimated to account for around 35 per cent of the overall responsibilities as the primary reason for staying out of
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decline in female labour force participation in between the labour force, compared with only 1.1 per cent of men .
2005 and 2019. In addition, restrictive labour laws prohibit To enable greater participation:
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women from working in certain industries or roles deemed • Ensure safe, affordable, and reliable transport options to
hazardous or dangerous, further limiting their employment enhance women’s mobility and access to workplaces.
options. Some might argue that educated women struggle
to find employment because of a skill gap. However, the • Establish childcare facilities at or near workplaces to
data tells a different story. With 42 per cent of graduate ease the caregiving burden.
women being employable compared to 43 per cent of
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graduate men , skill and capability are essentially equal.
This near parity makes it clear that India’s stark gender gap Flexible and Inclusive
in labour force participation cannot be explained by Work Arrangements
differences in qualifications or readiness for work. The
issue is not that women lack the skills to be employed - it’s Workplace flexibility is a key driver of female participation.
that systemic barriers prevent them from converting those Research shows that when women are offered flexible
skills into actual labour market participation. arrangements - such as choosing work hours, remote
work, or the ability to manage childcare - they are 33
percentage points more likely to start working than when
Policy Suggestions for Building offered traditional office jobs .
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an Inclusive Economy Steps to promote flexibility include:
• Encouraging remote and hybrid work models,
Addressing India’s persistently low female labour force particularly for mothers and caregivers.
participation requires a holistic and multi-dimensional
strategy that tackles structural, social, and institutional • Expanding part-time and job-sharing opportunities for
barriers simultaneously. The following key measures can women balancing multiple responsibilities.
help create a more inclusive and gender-responsive
economy:
Formalisation as a
Employment Generation Pathway to Inclusion
with a Gender Lens
Formalisation of the economy can significantly enhance
Job creation remains a national priority, but efforts must be women’s labour market outcomes by improving job
intentional about including women. This involves quality, security, and access to social protection. Women
prioritizing sectors where female participation can expand are disproportionately concentrated in informal and
and promoting women’s entrepreneurship through access unpaid work, where earnings are low and protections
to finance, mentorship, and market linkages. are minimal.
Formalisation can promote inclusion by:
Gender equity is not merely a social goal but an economic
imperative. The “gender dividend” represents the vast • Expanding access to written contracts, minimum
potential returns that economies can realise by embracing wages, and grievance redressal mechanisms.
gender diversity. It is estimated that India could add up to • Ensuring eligibility for social security benefits such as
18 per cent to its GDP by closing gender gaps and maternity leave, health insurance, and pensions.
increasing female workforce participation Also,
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businesses with gender diversity in leadership see 25 per • Facilitating access to institutional credit and formal
cent higher profitability as compared to their peers. 9 value chains for women entrepreneurs

Gender Gap and Decline in Female Labour Force Participation in India: A Joint Search Perspective; Bishnu, Chandrasekhar and Murali; 2024
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India’s Graduate Skill Index 2025, Mercer-Mettl
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The Power of Parity: Advancing Women's Equality in Asia Pacific; McKinsey Global Institute; 2018
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Diversity Wins- How Inclusion Matters; McKinsey & Company; 2020
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The impact of care responsibilities of women’s labour participation; International Labour Organization; 2024
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Bringing work home-Flexible work arrangements as gateway jobs for women; Ideas for India; 2024
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