Short read: MGNREGA Led to Decline in Gender Wage Gap, Increased Compliance with Minimum Wage Norms: ILO

Over the past year we have written several blogs about the rise in the fortunes of Indian women – urban & rural, skilled & unskilled – over the past decade (eg. The Rapid Rise of Female Entrepreneurs in India – Marcellus). Now, the International Labour Organisation (ILO) has found that for rural women, NREGA has been a boon: “The implementation and expansion of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has resulted in the decline of the gender wage gap besides increasing compliance with minimum wage regulations in rural areas, the International Labour Organisation (ILO) has found.

The findings are from ILO’s latest working paper – Employment and wage disparities between rural and urban areas.

According to the paper, the gap in rural wages between formal salaried workers and casual workers has also decreased due to the employment guarantee scheme.

As NREGS was introduced and expanded, the rate of compliance with minimum wage regulations increased, the gap in rural wages between formal salaried workers and casual workers decreased and, similarly, the gender wage gaps in rural areas declined. Alongside other factors, the NREGS programme seems to have played an important role in these positive trends,” Business Standard quoted from the paper.”

Commonsense suggests that if you increase the bargaining power of the most vulnerable people in the labour market, they get better outcomes. Thankfully, after many years of debate, across the political spectrum there is consensus now on this subject.

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