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Thursday, May 13, 2021

Care economy: Why India must recognise and invest in care work

Building infrastructure and services, including pre-primary education, maternity, disability and sickness benefits, and long-term care, will help ensure that India’s post-COVID recovery is equitable and gender-inclusive.

Written by Mitali Nikore |
Updated: April 14, 2021 5:37:14 pm
elderly care, old age homeIndia spends less than one per cent of GDP on care work infrastructure and services, including pre-primary education, maternity, disability and sickness benefits, and long-term care as per the ILO. (Representational)

The Cambridge Dictionary defines “infrastructure” as “the basic systems and services that are needed in order to support an economy.” Traditionally, infrastructure has been understood and interpreted to mean physical, immovable assets, primarily in the energy, transport, telecommunications and water sectors.

Over the last few years, there has been an increasing recognition that “infrastructure” should be more broadly defined. Jennifer Bennett, Robert Kornfeld, Daniel Sichel and David Wasshausen of the National Bureau of Economic Research, US, argue that economies need to include social infrastructure for education and health sectors, and advanced digital infrastructure in the ambit of the term. The UN’s Sustainable Development Goals call on governments to build sustainable, climate resilient facilities or green infrastructure, which account for environmental impacts.

And now, the American Jobs Plan unveiled by the Joe Biden Administration has put the spotlight on another sector — care economy infrastructure.

The $2.3 trillion American Jobs Plan proposes to allocate $400 billion towards constructing affordable home or community-based facilities for elderly care and $25 billion for a Child Care Growth and Innovation Fund to upgrade government childcare centres. The plan also proposes to incentivise private sector firms, so that they receive tax credits for expenditures upto $500,000 on building on-site child-care facilities.

In the United States, where 95 per cent of childcare workers, 85 per cent of home health aides, and 87 per cent of healthcare social workers are women, this proposed investment in care infrastructure will benefit women. The plan also unambiguously acknowledges that unpaid care work is a barrier to women’s labour force participation, and that investing in care economy infrastructure is a strategy to bring women back to work post COVID-19.

Most importantly, by treating care economy assets as infrastructure, the plan explicitly recognises childcare and elderly care spending as investments rather than expenditures and emphasises their centrality to economic recovery. This is a global first.

Closer home, it is heartening to see several leaders across the political spectrum recognise the disproportionate burden of unpaid care on women, who perform 10 times the domestic work than men. Yet, to address this imbalance, proposals of salaries for housewives are being mooted, a measure which can potentially entrench gender roles in care work even further.

The Maternity Act, 2017 mandates that employers must provide crèche facilities within a prescribed distance. Yet, in practice, implementation remains dismal. IFC surveys conducted in 2019 show only 49 per cent of employers had creche facilities in place. The absence of clear implementation guidelines, penalty provisions, or monitoring makes non-compliance pervasive as has been reported.

The country’s 2.5 million women Anganwadi workers (AWWs), auxiliary nurse-midwives (ANMs) and accredited social-health activists (ASHAs) are not recognised as workers or paid fixed monthly salaries in many States. The Parliamentary Standing Committee on Labour (2020) has now called on the Ministry of Labour and Employment to determine wage thresholds for frontline health and care workers.
Moreover, there has been little progress on formalising working conditions for India’s 3.9 million domestic workers (of whom 2.6 million are women), even as the National Platform for Domestic Workers Bill 2016, and the National Policy on Domestic Workers remains under consideration.

The post-COVID economic recovery will invariably be public-sector led, as private investment declines. New capital investment by foreign private players in India fell 96.1 per cent, and domestic players by 44.5 per cent in March 2021 compared to March 2020 as per CMIE. Sectors prioritised for public investment will determine the extent to which India’s economic recovery path is equitable, green, and gender inclusive.

India spends less than one per cent of GDP on care work infrastructure and services, including pre-primary education, maternity, disability and sickness benefits, and long-term care as per the ILO. A medium-term plan to increase public investment in care economy infrastructure offers India a credible instrument to meet multiple policy objectives.

First, creating jobs, especially for women. An analysis by the Women’s Budget Group (2019) showed that if an additional 2 per cent of the GDP was invested in the Indian health and care sector, 11 million additional jobs could be generated, nearly a third of which would go to women. Moreover, countries which invest in a combination of childcare infrastructure and parental leave policies to offset the burden on women, have a higher maternal employment to population ratios as per the ILO.

Second, stoking gender-inclusive economic growth. Women’s unpaid work is valued at 3.1 per cent of GDP in India. Recognising AWWs, ANMs, ASHAs and domestic help (amongst others), as formal sector workers would allow their economic contribution to be counted in the GDP. Investment in care infrastructure and services can also be in the form of public private partnerships, to develop expertise of the private sector.

Third, reducing gender-based income inequalities. OECD’s cross-country analysis shows countries where women work longer unpaid work hours have higher gender wage gaps. India’s average female daily wage was 59 per cent of the male wage in 1993-94 and improved to 72 per cent in 2018-19, with differences being higher for casual work. Investing in care infrastructure can prevent “occupational downgrading”, so that women become less likely to end up with lower pay when looking for flexibility, or part-time roles owing to care work responsibilities.

The IMF’s guidance to governments facing tough trade-offs amidst competing priorities post-COVID is clear — public investment should focus on equity, efficiency and effectiveness and protect vulnerable groups. In a country where women spend half their waking hours on unpaid care work, preparing food, cleaning, providing childcare, and collecting water/firewood, we need to prioritise public investments in care infrastructure and services for a more gender equitable post-COVID economic recovery.

The writer is an independent economist and founder of youth-led economics research and policy think tank, Nikore Associates

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