Rise in female labour force participation driven by rural push, says Economic Survey

There had been a consistent increase in Female Labour Force Participation Rate (FLFPR) over the past seven years driven largely by a rise in women entering workforce in rural India, the Economic Survey for 2024-25 said.

The survey, tabled in Parliament by Union Finance Minister Nirmala Sitharaman on Friday (January 31, 2025), said this increase in FLFPR was the primary driver behind overall improvement in the labour market indicators.

According to the Periodic Labour Force Survey (PLFS) 2023-24 quoted by the survey, there was an enhanced participation of women in economic activities across various categories, including rural and urban. “This increase in FLFPR can partly be attributed to better capturing female workers in unpaid work by the PLFS survey”, it said.

The PLFS was conducted in selected districts of Bihar, Jharkhand, Madhya Pradesh, and Uttar Pradesh in November 2024.

The FLFPR had increased over the past seven years from 23.3% in 2017-18 to 41.7% in 2023-24, the survey said.

Currently, 21 States have a FLFPR in the range of 30-40%. Seven States or Union Territories reported FLFPR greater than 40%, with Sikkim reporting the maximum rate of 56.9%. While in 2017-18, 20 States and Union Territories had FLFPR of less than 20%, in 2023-24 it is only three states.

Rural FLFPR, which was the primary driving force behind overall increase in women’s workforce participation, rose from 24.6% in 2017-18 to 47.6% in 2023-24.

The survey said that this rise could be attributed to women taking advantage of new opportunities brought about by various government initiatives.

The increase in rural women workforce participation can also be attributed to the skilling initiatives and improved access to credit for diversified livelihoods provided to women’s collectives under the Deendayal Antyodaya Yojana — National Rural Livelihood Mission (DAY-NRLM).

Further, the increased push of government towards encouraging entrepreneurship was also likely a key contributor. For example, as of October 31, 2024, a total number of 73,151 start-ups with at least one woman director were recognised under the Startup India Initiative. This represented nearly half of the 1,52,139 start-ups supported by the government.

The survey noted that building a strong ecosystem for women’s entrepreneurship required innovative solutions alongside government initiatives including focus on credit access, skill training, and formalisation.

Rural women entrepreneurs face additional challenges, including limited business skills, market access, and technology gaps, compounded by a lack of mentorship and networking. Streamlining support through credit linkages, sensitising bankers, and efficient delivery mechanisms is essential. Cost-effective strategies, such as raising awareness, providing skill training, and improving access to government benefits, can empower women entrepreneurs, it said.