The patriarchal and conservative attitudes of young Indian males could dampen the country’s consumption story as they keep women away from the workforce, locking up a huge chunk of demand.
Some 40% of young Indian males did not want their wives to work post-marriage (35% of the females agreed with this), according to a report published by brokerage Kotak Institutional Equities. With fewer women in the workforce, consumption could fall, thereby pulling down economic growth, the April 24 report, based on a survey by the Centre for the Study of Developing Societies (CSDS) and Konrad Adenauer Stiftung, a German think-tank, indicated. The survey involved some 6,000 youth across India.
Already the participation of women in India’s workforce is one of the lowest in Asia and the least among emerging economies.
Besides, consumption is a key factor fuelling economic growth. Stock market observers often closely track consumer insights which are an indicator of the economy’s health. A huge pool of young and working persons, hence, is a driver for consumer-focused businesses betting on India’s 1.3 billion population. The report says automobile, cement, and consumer durable stocks will see a direct impact of consumption patterns.
Thus, a significant chunk of India’s eligible population being locked out of the workforce—and, hence, lacking buying power—doesn’t bode well for the economy. In fact, a McKinsey report had estimated in 2015 that if the gap between male and female participation in the workforce is filled, India’s GDP could gain as much as 60% in 2025.
“We note that public discussions have largely focused on low education levels and skills of India’s young population but a bigger issue may be the mindset of the Indian youth (particularly, male). India’s long-term consumption story could get affected without corrective actions” the Kotak report said.
Besides women being pulled out of the workforce, there were also other problems facing the economy, the report noted. There’s a “mismatch between the aspirations of the youth with respect to their preferred jobs and availability of jobs,” the Kotak report noted. While India will have the world’s largest young workforce by 2020, the quality of the workforce and the supply of jobs compared to this demand is worrying.
For India, ramping up aptitude among its youth is critical but it can’t afford to neglect attitudes at the same time.