Mahatma Gandhi, long ago had exclaimed in regard to Hindu-Muslim divide- “The nation walks with one leg only.” Post 6 decades, this statement stands true for the economy too. The gender divide in the workforce has had similar trivial consequences for the economy. How will the new maternity leave laws impact this?
Globally, according to the United Nations and International Labour Organization, there has been a drop of the number of total women in workforce from 35% in 1990s to 27% in 2017.
Maternity Act Benefit, 1961
New amendments in Maternity Act Benefit 1961 have been realised after the maternity leave has been increased to 26 weeks, from 12 weeks, as adopted earlier. This may cause pangs in the short run and financial blow hardening in the long one. This comes at a time when the economy is recovering from the GST and digitalization related disruptions. Proportionally, India marginally tops Pakistan and Saudi Arabia in the number of women in the total workforce and ranks 65. But this has a negative impact on the human resource development, wholly.
This is increase in cost can be easily borne by the large corporates but the medium, small and micro enterprises might shy away from hiring young women. Or they might decrease their compensation as a result of higher comprehensible lifetime costs of their employment.
But the recent revamping in the organization culture has more or less made the work flexible. The government is further required to soften the impact of these policies on the organizations by, maybe giving tax rebates and easy compliance policies. Although for the social well-being and improving the quality of life, this is a great step of filling the gender bias gaps in the system- but how will it affect the number game of the country is something to look forward to !