Why in news?

A new report by Quess Corp and the Udaiti Foundation reveals that over half of blue- and grey-collar women workers in India are dissatisfied with their low wages, with 80% saving less than ₹2,000 per month.

These inadequate earnings are a key reason why many women leave formal employment, especially when weighed against the high opportunity costs of working.

The report highlights a significant gap between the minimum wage and the actual “living wage” needed to cover essential expenses like health and education.

Recognising this, the Labour Ministry is now considering the inclusion of these costs in wage standards to make formal work more viable for women.

What’s in Today’s Article?

• Living Wages
• Low Pay and High Costs Forcing Women Out of Workforce
• Government Explores Expanding Minimum Wage Definition to Support Women
• Beyond Wages: Structural Barriers Hindering Women’s Workforce Participation
• Manufacturing Hubs Boost Women’s Employment Opportunities

Living Wages

• A living wage is the minimum income necessary for a worker to meet their basic needs such as food, housing, clothing, healthcare, education, and some level of financial security.
• Unlike minimum wages, which are set by law and often do not account for actual living costs, living wages are calculated based on the cost of living in a specific region.
• Living wages ensure that workers and their families can live with dignity without falling into poverty.

Low Pay and High Costs Forcing Women Out of Workforce

• A recent survey by Quess Corp reveals that blue- and grey-collar women workers earn only 70% of what their male counterparts make.
  • Blue- and grey-collar women workers are women employed in roles traditionally considered manual labor or technical/skilled trades, respectively. 
  • Blue-collar work often involves physical labor, while grey-collar jobs require specialized skills and may involve a combination of physical and intellectual tasks. 
• Coupled with high opportunity costs such as unpaid caregiving, long commutes, and migration expenses, many women struggle to remain in formal employment.
• The study highlights that women in peri-urban manufacturing zones often face lower minimum wages despite higher living costs.
• Notably, one in five women earn less than ₹20,000 per month, the typical minimum wage in Tier 1 cities.
• The data also shows that women earning above ₹20,000 are 21% less likely to exit the workforce soon, indicating that better pay significantly improves retention.

Government Explores Expanding Minimum Wage Definition to Support Women

• The government is considering broadening the definition of minimum wage to include expenses on health and education—currently excluded from wage calculations.
• Presently, the minimum wage is based only on nutrition, housing, and clothing.
• From a women’s perspective, including childcare and healthcare costs would help reduce the opportunity cost of working.
• Experts acknowledged the challenge of implementing this in a diverse country like India, where conditions vary by state, and stressed the importance of initiating a social dialogue with both employers and employees.
• While the move is still in early stages, she welcomed the fact that discussions have begun.

Beyond Wages: Structural Barriers Hindering Women’s Workforce Participation

• While implementing living wage standards would benefit all workers, the impact on women could be especially transformative due to their higher opportunity costs.
• India’s female labour force participation rate (LFPR) remains low at 32%, compared to 77.1% for men, as per the June PLFS data.
• Economists argue that raising women’s LFPR above 50% is essential for India to reach developed nation status.
• However, women face multiple challenges beyond wages, including unsafe or unaffordable housing, poor work culture, limited mobility, and regulatory restrictions.
• Experts noted that 54 existing laws restrict women's employment, such as those banning night shifts.
• While these are being gradually repealed, they highlighted that responsibility for women’s safety—especially during night shifts—then falls on employers, a burden more easily borne by large firms than small businesses.
• Addressing these layered barriers is critical to enabling more women to join and remain in the workforce.

Manufacturing Hubs Boost Women’s Employment Opportunities

• States with strong industrial and manufacturing bases, such as Tamil Nadu, Karnataka, and Maharashtra, are leading in female workforce participation.
• Modern electronics and auto manufacturing units in these states are increasingly employing women due to their skills in finger dexterity and hand-eye coordination—qualities that are tested and found more often in women.
• As a result, sectors like electronics and automotive manufacturing are actively seeking female workers.