A Case Study: Understanding the Gender Pay Gap in the Indian Economy

This case study explores the gender pay gap in India, highlighting the disparity between male and female earnings in similar roles. It references studies indicating a significant wage difference, particularly in the organized sector, and emphasizes the impact of social and demographic factors. The...Read More

Running Head: CASE STUDY: GENDER PAY GAP IN INDIA
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Running Head: CASE STUDY: GENDER PAY GAP IN INDIA
Abstract
Kiran Mazumdar Shaw, the managing director of Biocon India earns 18 crore rupees per
annum as a remuneration. We can find many more faces like her in the corporate corridors
very easily. However, when we check the salary structures of the executive level female
workers in India we find that most of them are underpaid in comparison with their male
counterparts. According to a study done in the year 2013, the wage difference between male
and female workers working under similar capacities is around 24 percent (Agrwal, 2017).
This figure reflects a huge gender pay gap in India. From a macroeconomic point of view,
this gender pay gap also reflects the fact that the direct participation of women in the Indian
economy is less. This fact can be considered as a barrier against the growth of the economy in
a country where 48 percent of the population is female. In the current report, we are exploring
this underperformance of the women in the Indian economy from the perspective of the
gender pay gap which is prevailing in India.
Background of the problem and its current status
The latest monetary sales index (MSI) associated with the gender gap in India gives us a
figure that females are earning 19 percent fewer wages in comparison with the males
(Bhattacharya 2019).
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Running Head: CASE STUDY: GENDER PAY GAP IN INDIA
Image 1: The median difference between the male and female salaries calculated by wage
indicator foundation. Retrieved from
https://www.business-standard.com/article/management/gender-pay-gap-in-india-at-27-
monster-salary-index-116051700807_1.html
This figure is only a symbol because the scope of this finding is confined to the organized
sector only. The unorganized sectors of the Indian economy can present a different picture
altogether where the ratio of this gender gap may be much higher. While having a systematic
look at the major publications covering this issue, we figured out that the issue of the gender
pay gap is dependent on certain demographical and social factors. This systematic literature
review of more than 50 trusted industry sources and peer-reviewed studies also gave us an
idea that the genesis of this problem may have its root in the social structure of the society.
Prior to the study the problem on a sociological platform we would like to supply another
fact, the gender pay increases as we move ahead in the ladder of skilled professionals. The
MSI index of last five years gives us a figure that the gender pay gap in the highly skilled
sections of the industry is thirty percent. This staggering number forces us to conceive a
hypothesis that goes asunder.
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Running Head: CASE STUDY: GENDER PAY GAP IN INDIA
Image 2: The impact of glass ceiling on the factors like "hot jobs" and "long term
employment of the women in India has figured out the in survey done by McKinsey in 2018,
Retrieved from https://timesofindia.indiatimes.com/business/india-business/India-Inc-begins-
audits-for-equal-pay/articleshow/50842800.cms
The glass ceiling caused culture and gender stereotyping is giving rise to a gender pay gap,
this gender pay exists because most of the employers feel that they cannot nurture up females
in their talent pools in the long run because of the limitations attached to their performance in
comparison with the mails.
Analysis of the case
India is a patriarchal society; it will not be a far-fetched statement when we will say that it is
a male-dominated society with strong gender stereotyping imbibed as a cultural value. This
social structure plays a crucial role in the participation of women in the economy. States of
Northern India has lesser participation of the women in the mainstream economy whereas the
southern part of India is more liberal in this regard.
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Running Head: CASE STUDY: GENDER PAY GAP IN INDIA
The case of the gender pay gap and glass ceiling has got nothing to do with the economic
status of a country. Women living in developed countries like USA and Australia are also
facing the same problem (Mohanty,2015). This comparison gives us an idea that the root
cause behind the gender pay gap is not associated with economic factors; they are more
related to the social fabric of the place. In the case of India, most of the researches confirmed
the fact that employers don't consider women as an employee in the long race. Factors like
pregnancy leaves and settlement with the family overpower the ability of the females to
deliver the goods (Guzi,2015).
This is only a social mindset, "Women of India INC" conducted a survey in the year 2019,
the results of this survey show that 43 percent of the women were not considered a long term
career because of the maternity leave. The same number of women was also unhappy with
the fact that when they will make a comeback in the field of the job after maternity leave they
will be offered less salary in comparison with their male counterparts (Chowdhry,2015).
Here we need to put a glance on the legislative position of gender pay gap all over again. In
the case of India, in the year 1976, the authorities passed the “Equal Remuneration act
(Mahajan,2017).” The recommendations of this act are still not in practice under the
corporate sector and unorganized sector. The creamy layer of industries are following it,
however, the presence of women in these organizations is very less in ratio with male
employees. Ancillary legislations related to the maternity leave and other conditions also
served as deterrence for the corporate sectors and other industry sectors to hire women
(Lam,2016). The ancillary acts in the support of the post-pregnancy working routines of the
women have a clause that they cannot be subjected to ardors work, this clause refrains the
employers to hire women to post pregnancy (Chakraborty,2016).
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Running Head: CASE STUDY: GENDER PAY GAP IN INDIA
We can also say that it has become a perception in the mind of the employers that there are
limitations that prevents them to utilize women more freely (Varkkey, 2014). The industry
sector analysis of this statement presents the example of the IT sector in front of us. In
principle, women are equal to males when it comes to applying their brains in a task
(Sengupta, 2014). It means that the gender pay gap in this sector should be less because
mainly they are dealing with the intellectual pursuits of their employees. IT sector of India is
not an exception; they are ready to nurture up the talent in this sector. However, they are not
ready to put their money on female employees and using their services as a filler
(Bhattacharjee,2015).
Conclusion
On a conclusive note, we can say that the gender pay gap exists in India. We can attribute the
gender gap to a glass ceiling caused by the cultural mindset of society. Although adequate
legislation and labor laws are present in India, even then the perceptions related to the
inability of the female employees exist social belief systems are promoting them. The
comparison of gender pay gap data for the last six years gives us an indication that the status
of the gender pay gap is improving with each passing year. However, it is happening because
females are shattering the glass ceiling by delivering strong performance in the field of job.
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Running Head: CASE STUDY: GENDER PAY GAP IN INDIA
References
Agrawal, S., Khan, J. & Upadhyay, H., 2014. Labour Market Discrimination against Women
in India. Indian Development Review, January-December, 12(1-2), pp. 93-116.
Bhattacharjee, S., Hnatkovska, V. & Lahiri, A., 2015. The Evolution of Gender Pay. In: S.
Shah, A. Panagariya & S. Gokarn, eds. India Policy Forum 2014-15: Volume 11. New
Delhi: Sage Publications India.
Chakraborty, S., 2016. The Price of Prejudice: Employment Trend and Wage Discrimination
of Women Workers in India. The Journal of Industrial Statistics, 5(2), pp. 192-226.
Chowdhry, A., 2014. Microsoft CEO Satya Nadella Apologizes for Comments on Women's
Pay. [Online] Available at:
https://www.forbes.com/sites/amitchowdhry/2014/10/10/microsoft-ceo-satya-
nadellaapologizes-for-comments-on-womens-pay/#6d2b25bb6d2b [Accessed 1 May
2017].
Guzi, M. & García, P. d. P., 2015. A web survey analysis of subjective well-being.
International Journal of Manpower, 36(1), pp. 48-67
Lam, B., 2016. How Do We Close the Wage Gap in the U.S.?. [Online] Available at
https://www.theatlantic.com/business/archive/2016/03/equal-pay/472407/ [Accessed 1
May 2017].
Mahajan, K., 2017. Rainfall Shocks and the Gender Wage Gap: Evidence from Indian
Agriculture. World Development, March, Volume 91, pp. 156-172.
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Running Head: CASE STUDY: GENDER PAY GAP IN INDIA
Mohanty, S. S., Bisht, M. & Mohapatra, P., 2014. Gender Wage Gap among Salaried
Workers in India: Results of a Principal Component Analysis of State Level Statistics.
Economic Affairs, 59(2), pp. 175-190.
Sengupta, A. & Das, P., 2014. Gender Wage Discrimination across Social and Religious
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