Increase of Female Labour Force Participation Rate

• 13 Dec 2024

Why in News? 

• Recently, the Economic Advisory Council to the Prime Minister (EAC-PM) reported that the female labour force participation rate (LFPR) increased in almost all states in India between 2017-18 and 2022-23, with rural areas experiencing larger gains than urban areas. 

 Key Points 

• Key Findings on Female LFPR: 
  • Regional Variations: 
    • Bihar, Punjab, and Haryana consistently reported very low female LFPR. 
    • Despite being among the richest states, Punjab and Haryana have low female LFPR, while Bihar, the poorest state, also lags. 
  • Growth: 
    • In Rural areas Female LFPR rose to 41.5% from 24.6% during 2017-18 to 2022-23. 
    • In Urban areas Female LFPR increased to 25.4% from 20.4% during the same period. 
    • Overall Trend is that growth remained consistent even after excluding unpaid family workers or household helpers. 
• Other Trends: 
  • Marital Status: 
    • Married men exhibit higher LFPR across states and age groups. 
    • Marriage significantly reduces female LFPR, especially in urban areas. 
  • Age Dynamics: 
    • Female LFPR forms a bell curve, peaking at ages 30-40 and declining sharply after. 
    • Male LFPR remains nearly 100% between ages 30-50 and declines gradually thereafter. 
  • State-wise Observations: 
    • Northern States: Punjab and Haryana recorded low female LFPR. 
    • Eastern States: Rural Bihar had the lowest LFPR but showed improvement, particularly among married women. 
    • Northeastern States: Rural areas showed progress, with Nagaland and Arunachal Pradesh leading. 
• Impact of Government Schemes: 
  • Mudra Loans 
  • Drone Didi Scheme 
  • Deendayal Antyodaya Yojana 
    • These schemes emphasize women-led development, reflecting the government’s intention to promote female participation in the workforce. 
• The rise in female LFPR, especially in rural areas, underscores a notable shift in employment trends. Further analysis and government support will be essential to sustain and amplify this growth. 

 Economic Advisory Council to the Prime Minister (EAC-PM) 

• It is an non-constitutional, non-statutory, independent body constituted to give advice on economic and related issues to the Government of India, specifically to the Prime Minister. 
• The council serves to highlight key economic issues to the government of India from a neutral viewpoint. 
  • It advises the Prime Minister on economic issues like inflation, microfinance, and industrial output. 
• For administrative, logistic, planning and budgeting purposes, the NITI Aayog serves as the Nodal Agency for the EAC-PM. 
• Periodic Reports: 
  • Annual Economic Outlook. 
  • Review of the Economy.