Published: December, 2020
The pandemic and subsequent lockdown measures in India have taken a toll on all aspects of life, particularly on livelihoods. While job losses have been observed in both rural and urban sectors, recent figures show that there has been an increase in creation of non-salaried jobs in rural areas, but generation of wage employment in the urban sector has remained a challenge. Over 21 million salaried jobs have been lost in India (out of a base of 86 million overall salaried jobs) between April and August 2020. A survey by the Azim Premji University suggests that urban areas posted a loss in employment for 8 in 10 workers. This evidence points to the fact that urban livelihoods have taken a huge hit due to the COVID-19 crisis, and the ability of the urban sector to create new jobs to compensate for these losses is currently under a cloud.
Women have been disproportionately affected by job losses. A recent report tracking the pandemic’s influence on informal work in India suggests that more women were out of work post-lockdown compared to men (about 79 percent of women surveyed, compared to 75 percent of the men). Such findings are expected as women are overrepresented in the informal and unorganised sectors such as domestic work, construction work, beauty and wellness industry, and sex work, which have been acutely impacted due to lockdowns. Even in the formal sector, women are more likely to be hired for temporary or part-time positions, making it easier for firms to let them go if there is downsizing, while avoiding social security benefits.
This decrease is especially worrying, as female labour force participation rate (FLFPR) in India has witnessed a decline since 1990. Declining female labour force participation in economies is known to lead to several negative externalities including a reduction in household financial, food and nutrition security, as well as a direct reduction in consumption expenditure of households, thereby creating a drag on the growth of India’s Gross Domestic Product (GDP), which depends largely on consumption expenditure.
Given the dire consequences induced by the pandemic and its severe impacts in urban areas, several policy experts and analysts have opined that this an opportune time for governments to step in and ensure some semblance of livelihood guarantee in urban areas, much like the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) does for rural areas. It is in this context that we undertake this research.
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This analysis has been authored by Deepro Guha and Aparajita Bharti of TQH. Valuable feedback and inputs were provided by Soumya Kapoor Mehta, Head, IWWAGE.