Contribution of Education in the Changing Female Wage Structure in the Last Three Decades in India

Kaushalendra Kumar , International Institute for Population Sciences (IIPS)
Ankita Shukla, International Institute for Population Sciences (IIPS)
Abhishek Singh , International Institute for Population Sciences (IIPS)

Post economic liberalization in 1991 India has witnessed fast economic growth. And, in last few decades female participation in formal wage employment has increased substantially. However, female being most vulnerable group in labour markets they are being paid less than their male counterparts in India. Education is one of the important endowments which increases wage bargaining power. Present study assesses the contribution of improvement in women’s education on their wage structure in India over the last three decades 1983-2011. We used two rounds of NSSO (National Sample Survey Organization) – 38th (1983-84) and 68th (2011-12) data on Employment and Unemployment. Wage has been convert constant price. Bivariate analysis reveal that female wage has increased during 1983-2011. Graduate and above educated females have higher mean wage as compared to illiterate ones. Further, female’s participation in primary sector has declined whereas theirs’ participation has increased in business and service sector. Oaxaca-Blinder decomposition shows that female’s education significantly contributes 10% to the total increment in wages during 1983-2011. Machado-Mata Decomposition (MM) shows that contribution of socio-economic distribution of female worker increases at the higher wage distribution, whereas, the contribution of socio-economic characteristics declines. The findings reveal that although women’s participation in economic activities has increased over the past three decades, their participation rates in business and service sector is still low. More needs to be done in most sectors including technical education, economic empowerment and access to financial services.

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 Presented in Session P1. Postercafe