Best of Both Sides: Cities still don’t work for women

Nor is it surprising that employed women in big cities are concentrated in salaried jobs. Women place high value on non-wage attributes such as predictable hours, formal contracts, paid leave, safety, childcare and transport. Research shows that women’s participation rises with the expansion of white-collar work, which offers higher returns and social acceptability. Our research similarly finds that larger firms employ more women, likely because they offer amenities like maternity benefits, transport and paid leave.

The salaried-work statistic must therefore be read carefully, since it is conditional on being employed. It tells us only that among the minority of urban women who make it into paid work, many select into better jobs. It does not mean the city has solved women’s employment problems. A city where three-fourths of women remain outside the labour force cannot declare success because the one-fourth who work are more likely to be salaried.

The same caution is needed in reading the earnings numbers. On average, women earn 22.7 per cent less than men, an important disparity, but monthly earnings do not account for hours worked. The PLFS data show that women employed in salaried work work almost 12.6 per cent fewer hours per week than men. In bigger urban cities, this hour gap is slightly larger, at around 14 per cent. A simple accounting exercise shows that fewer hours explain almost 20 per cent of the earnings gap. Adding age, education and occupation raises the explained share to just 30 per cent. The larger point remains that a sizeable earnings penalty for women persists irrespective of city size, pointing to a more general problem of gender discrimination.

The harder question is why female participation is lower in the largest cities than in urban India as a whole. One answer lies in the geography of work, since women’s employment is not just a wage decision. Evidence from job-search behaviour shows that women search closer to home and are willing to trade off wages for shorter commutes. Indian evidence on urban mobility points the same way. Women are far less likely than men to step out of the home on a given day, reflecting safety, household responsibility, social norms and weak transport systems. Fewer hours worked reflect similar constraints of care, commuting and safety.

This helps explain why rural India has historically shown higher female work participation. Much rural work is low-paid and informal, but agriculture and allied work is often closer to home and easier to combine with domestic responsibilities. As work moves from farms to firms, non-agricultural growth can exclude women in the absence of safe transport, affordable childcare and quality jobs.

The unemployment data also tell the same story. Female unemployment (ages 15-59) is higher than male unemployment everywhere, but the gender gap is larger in the 46 big cities, at 9.81 per cent for women against 6.49 per cent for men, versus 9.07 and 6.36 per cent elsewhere. Big cities are not merely places where women opt out. They are also places where women looking for work face a harder matching problem.

India’s urban agenda cannot treat women’s employment as an automatic by-product of growth. Cities need frequent and safe public transport, last-mile connectivity, street lighting, mixed-use neighbourhoods, childcare and regulations that make amenities easier for employers to provide. The real lesson from the new data is that even our best labour markets do not work for women. Until cities reduce the time, safety and care costs of taking a job, they will continue to produce better jobs without producing enough women workers.

The writer is associate professor of Economics at Ashoka University and Co-Lead for Employment at the Isaac Centre for Public Policy