Bulk of South Asian women exposed to informal employment
In South Asia, only 20 out of every hundred women actively participate in the labour market, while the labour force participation for men is 80 %, far below the participation rates in other regions.
Between 80-90 percent of the workforce is stuck in unproductive informal sectors that have notoriously limited access to credit and sales markets. And South Asia lags behind other regions across the world except for the Middle East and North Africa in female labor force participation, according to the World Bank latest report.
In South Asia, more than 80 percent of women in non-agricultural jobs are in informal employment, and this leaves women often without any protection of labor laws, social benefits such as pension, health insurance, or paid sick leave.
The latest South Asia Economic Focus zeroes in on a possible answer to this conundrum. Using new data from 140 countries, the chapter on gender norms shows that in South Asia, perceptions about the role of women in society have not kept up with new economic opportunities as they have done in many regions of the world.
The analysis shows that these gender norms determine to a large extent, the participation of women in the labor force.
“The paradox here is that in most countries, education of girls tends to increase female labour force participation as education increases potential wages, which makes it more attractive to participate in paid work.
However, in South Asia, whereas education of girls has improved significantly during these past decades, the participation of women in the workforce has not kept up to speed.
If norms mandate that married women stay at home, then women are likely to withdraw from the labour market after marriage, irrespective of their education level.”
The region’s exports of goods traditionally a source of productivity growth is only one third of the size of exports when compared to other countries around the world.
“It appears that most of South Asia’s economic activity is concentrated in small pockets of societies, namely the formal workforce and male workers mostly employed by formal firms that have access to credit and are largely selling to domestic markets.
These segments can grow fast, but this is not the full throttle mode that is required to launch economies to their fullest potential.
Therefore, it’s not a surprise that currently, per-capita income in South Asia is only one fifth of the per-capita income in East Asia, a region with a much larger female labor force participation, smaller informal sectors, and an export-led growth strategy. The report suggests that for South Asia to reach its full economic potential, it must explore untapped opportunities.