Mapping Structural Break and Sectoral Movement on Female Employment in India Since 1991

Abstract

AbstractThe new economic regime in India has had a cascading impact on resource allocation and the redistribution of employment. Previous research has examined the general effects of economic shifts but lacks an exhaustive analysis of its impact on sector-specific female labour force participation (FLFP). This paper analyses structural breaks in sectoral FLFP in India using yearly data from 1991 to 2022, exploring the dynamic relationship among gross domestic product (GDP) contribution, education and FLFP across sectors and analysing inter-sectoral female labour movement. Results reveal that females engaged in the agriculture sector in India witnessed the highest structural breaks compared to other sectors. New economic reform of 1991, government policies, urbanisation and mechanisation, could be attributed to these breaks. Further, results revealed sectoral contribution to GDP and female education as an important determinant of FLFP. Along with this, the results of the Impulse Response Function show a significant shift in FLFP from agriculture to services. However, Variance Decomposition has provided evidence that the agriculture sector remains a fallback option for women in India. Based on these findings, the paper suggests that policymakers should promote higher education among women to enhance FLFP in the service sector. Furthermore, the study proposes strategies to attract and retain FLFP in the industrial sector, thereby alleviating labour pressures in agriculture.