This is how India can tackle unemployment and empower women

Feb 26, 2020

This article is published in collaboration with Quartz.

Employees work inside a textile mill of Orient Craft Ltd. at Gurgaon in Haryana, northern India April 16, 2014. When Narendra Modi talks about creating jobs in labour-intensive manufacturing, textile entrepreneur Sudhir Dhingra hopes the Indian opposition leader means business. Dhingra, who employs 30,000 workers in more than 20 factories around the capital New Delhi, says that politicians - for all their promises - have shown no interest in acting to avert a looming employment crisis. Early on, Dhingra survived a change of fashion that saddled him with a pile of unsold stock. Learning his lessons - to keep close tabs on the market and control costs - he built Orient Craft into $250 million business making 200,000 garments daily india women women men female male girls boys teenagers teens development gender gap parity equality diversity progress change feminine masculine woman man sex biology roles dynamic balance bias androgynous

Women currently own 20% of businesses in India. Image: REUTERS/Anindito Mukherjee

Niharika Sharma

Reporter, Quartz India

Encouraging female entrepreneurship could employ 170 million people by 2030.
Other benefits include social outcomes and gender-sensitive innovations.
Currently just 17% of female-owned enterprises employ hired staff.

Female entrepreneurs may hold the key to alleviating India’s unemployment problem.

Enabling women to start up and scale can help employ up to 170 million people by 2030, according to a joint report by Bain & Company and Google. “This will be 25% of the new jobs required for the entire working-age population,” said Megha Chawla, partner at Bain & Co and the lead author of the report.

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Women currently own a mere 20% of all enterprises in India. However, these units directly employ 27 million people. “If we focus on enabling more women entrepreneurs to start up and scale, we will be able to increase direct employment by 50-60 million people, and increase indirect and induced employment of another 100-110 million people (by 2030)” said Chawla.

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How many people female entrepreneurs directly employee in India. Image: Sixth Economic Consensus; Bain and Company

Increased participation of women in entrepreneurship has other advantages, the report noted:

Social outcomes: Enabling female entrepreneurship benefits future generations through the multiplier effect, the report said. Citing the International Monetary Fund, it noted, “Investing in women builds economic and social prosperity by enabling a gradual social shift from high fertility, low education and poor health to making more conscious reproductive choices, higher education and better health for self and family.”
Improved longevity in the workforce: As woman entrepreneurs experience greater financial independence, autonomy, and control, it leads to increased retention of women in the workforce. About 59% of women believe working for themselves reduces their dependence on a spouse or family, while 46% view it as a means to break the glass ceiling.
Gender-sensitive innovation: Woman entrepreneurs are fulfilling untapped customer needs through innovative businesses. “These businesses are fostering product innovation and addressing unmet and often neglected needs in the market,” the report said.

Current state

India has between 13 million and 16 million micro-, small- and medium-scale enterprises and agribusinesses owned by women, the Bain & Company-Google report stated.

Notably, most of these women-owned ventures are single-person businesses, which translates to lower returns and employment. Only 17% of all woman-owned enterprises employ hired workers in comparison with 28% for all enterprises, the report said.

Number of employees per Enterprise without hired workers. Image: Sixth Economic Consensus; Bain and Company

Rural, non-farm, home-based businesses form the largest share (38%) of woman-led ventures in India. Urban, self-employed women who work from home constitute 31% of woman entrepreneurs, as per the report.

“Farm-based business owners at 18% and small business owners at 14% employing less than 10 employees contribute most to employment generation,” the report said.

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