Companies in India move to retain women in the work force

Posted on March 11, 2016

COMPANIES IN INDIA, especially multinationals and tech firms, are rolling out these initiatives to keep women from dropping out of the work force when they get married or have children. As India’s government also prepares to extend mandatory paid maternity leave to six-and-a-half months -- among the longest such periods in the world -- a number of companies are preemptively extending them, too.

Societal attitudes in India also need to change to support the financial independence of women. -- Bloomberg
Retention is key: As Indian women became more educated and families more prosperous, the share of women working has declined from what was already one of the lowest levels among emerging market economies. While the phenomenon is also seen in the US and elsewhere, what’s at stake for India is the promise of faster and sounder economic growth -- as much as 2 percentage points higher, according to the Organization for Economic Cooperation & Development. McKinsey & Co. even posits that with equality in the labor force, India’s gross domestic product in 2025 would be 60% higher than if women’s work status remained at current levels.

“Most estimates suggest a very significant boost to India’s GDP if women are to enter and stay in India’s labor force in higher numbers,” Rohini Pande, an economist and public policy professor at Harvard University, wrote in an e-mail. “Critically, most surveys also suggest that India’s women want to work.”

Initiatives that help them keep doing so are critical, enabling companies to retain talented workers through the peaks of their careers. Mothers-in-law can pressure women to stay home to look after husbands and family. So the health care unit of General Electric Co. in India, which makes medical and diagnostic equipment, started a program to allow them to come to the office to see what their engineer daughters-in-law do all day.

“The effect was quite dramatic,” GE’s Chief Commercial Officer for South Asia Ipsita Dasgupta told a conference in New Delhi last year. “We saw women coming back and saying ‘Now my mother-in-law is actually yelling at my husband, saying,’ “You put dinner on the table. She has something important to do tomorrow morning!””

TeamLease, a temporary staffing and human resources firm based in Bengaluru, covers the expense of taking along a child under age 5 and a caregiver for women who travel on business trips. After trying the program on an as-needed basis, the company formally rolled it out late last year for its 1,100 employees, 40% of whom are women, said Rituparna Chakraborty, a senior vice-president at TeamLease.

“We’ve noticed that especially in sales, we have a lot of talented, highly performing women drop out when they have a child or after marriage,” Chakraborty said. “It’s not that as a company we will incur that much additional cost doing that, compared to the upside in terms of having them perform and be involved at work.”

Paytm Mobile Solutions Pvt, India’s largest e-payments processor, planned to start an in-house nursery as of April. Software developer HCL Technologies Ltd. has a coaching program for mothers struggling to balance home and work life. Citigroup, Inc. now offers as much as 132,000 rupees a year ($1,970) to help pay for child care, an India-only perk.

“That whole notion that ‘my job is secondary to my husband’ is carried by the women themselves, a mind-set we fight here everyday,” said Anuranjita Kumar, Citigroup’s chief human resources officer for South Asia, who says she tries to nurture “a sense of hunger” in young professionals so they won’t drop out. “The optimist in me sees that the landscape is changing, but the pace could be faster.”

Banking has been one area where India’s women have reached top management jobs.

Despite India’s low global rankings for women on measures such as the World Economic Forum’s gender gap index -- where India, at 108, trails Zimbabwe, Brunei, and Japan -- the country boasts at least four heads of major banks including State Bank of India and ICICI Bank Ltd.

There’s a long way to go.

Even in the technology sector, where an internal analysis by Mercer International, Inc. finds that women account for 40% of young recruits, their share once they reach middle management falls to 20% and further drops to 10% for leadership positions, according to Mercer’s Mansee Singhal.

“With almost equal intake at the entry level, companies have to ensure the right kind of retention at mid-management level, right kind of development, so they go up to leadership level,” she said. “The companies are realizing this is a very specific threshold of life, and they need to look at it or treat it differently.”

Most initiatives are only available in large cities, “but once the companies start having multiple branches and delivery centers, you will see it expanding to second- and third-tier cities, which stand to gain the most because there’s less available to women in terms of day care,” Singhal said.

A survey released Tuesday by British employment agency PageGroup, in conjunction with International Women’s Day, found that 72% of women in India think they’ll have improved work-life balance in the coming year, compared with 53% in the Asia-Pacific region as a whole.

India’s female work force participation rates peaked at 37% in 2005 and fell to 27% as of 2014, according to data from the World Bank. The US rate declined from 58% to 56% in the period, the data show.

In 2014, India’s stock regulator, the Securities & Exchange Board of India, mandated that publicly listed companies appoint at least one female director to their boards. A number of companies said in exchange filings that they had difficulty finding candidates.

The government must do more, including making streets and transportation safer for women to travel alone, and simplifying labor laws, TeamLease said in a report this year.

Societal attitudes also need to change to support the financial independence of women, Akhilesh Tilotia, head of thematic research at Kotak Securities Ltd. in Mumbai and author of a book on India’s economic transition, wrote in an e-mail.

“This is a big cultural issue, and there will be many arguments why the society wants women to stay at home,” he said. -- Bloomberg