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.