Unlocking Women’s Workforce Potential in India:Quantifying the Labour Market Impact of Formalising Part-time Employment and Gender Equality in Unpaid Care Work

In this paper, we investigate the macroeconomic and labour market implications of gender equality in unpaid care work and the formalisation of part-time employment in India. The unequal distribution of unpaid care responsibilities significantly limits women's labour force participation, perpetuating gender disparities in employment and economic outcomes. Using the McCall-Mortensen macroeconomic job search framework, this paper models the potential impacts of policy interventions on female labour force participation rates (LFPR). A key contribution of the paper is to derive quantitative estimates via model simulation. We find that formalising part- time employment contracts and equalising the time burden of unpaid care work between genders predict a 6-percentage point increase in female LFPR, raising the current rate from 37% to 43%. The findings underscore the critical need for formalising part-time employment contracts in India. Equalizing the burden of unpaid care would require raising public investment in childcare and eldercare infrastructure, and policies promoting paid parental leave and tax incentives for shared care. Drawing on best practices from the advanced world, the study emphasises the role of flexibility in enabling women to balance professional and domestic responsibilities.