Do Labor Market Opportunities Affect Young Women’s Work and Family Decisions? Experimental Evidence from India
Improvements in women’s employment opportunities lead to delayed marriage, reduced fertility and increased human capital investment.
In many developing countries, women frequently leave school, marry, and start having children at a young age. Labor markets may play a role in influencing these outcomes, as better employment opportunities may raise the cost of dropping out of school or the workforce. Rural India presents an interesting case: technological and regulatory changes led to rapid growth of India’s white-collar business process outsourcing (BPO) industry. The growth of this sector created a sharp and sudden increase in demand for educated female workers, who generally had very limited awareness of these jobs and minimal knowledge of how to access them. This article analyzes whether improvements in employment opportunities for women affect decisions about marriage, childbearing and human capital investment by connecting the villages to experienced recruiters over the course of three years in order to secure employment.
The study finds that improved employment opportunities led to employment gains and increased enrollment in training courses among young women and, correspondingly, delays in marriage and fertility.
- Young women aged 18 to 24 from villages with a recruiter were 4.6 percentage points more likely to work in a BPO job and 2.4 percentage points more likely to work outside the home than young women from villages without a recruiter presence. Their desire to work before marriage was 13 percentage points higher than women in non-recruiter villages.
- The intervention resulted in greater human capital investment in young women and girls. Young women from villages with a recruiter presence were 2.8 percentage points more likely to enroll in computer or English language courses, 5 percentage points more likely to be enrolled in school, and experienced improved nutrition.
- Increases in women’s employment and schooling were accompanied by significant delays in marriage and childbearing. Women aged 15 to 21 were 5.1 percentage points less likely to get married and to give birth. Moreover, young women aged 18 to 24 exposed to the intervention reported wanting to have .35 fewer children than women from non-recruiter villages.
In short, better employment opportunities appear to have increased women’s career aspirations, increasing human capital investment and delaying marriage and childbearing.
The researchers compiled a list of rural districts 50km to 150km outside of Delhi, in which awareness of and access to BPO jobs was likely to be low, not because of a lack of qualified women, but because of the high recruitment costs. They then randomly assigned 80 villages in those districts to the treatment group, with a recruiter presence, and 80 villages to the control group, without a recruiter presence. Eight recruiters were randomly assigned to villages in the treatment group. Baseline and follow-up surveys were conducted in 20 households in all 160 villages in 2003 and 2006, respectively, for a total of 3,200 households. The analysis focuses on women aged 15 to 21 at baseline.
The intervention provided BPO recruiting support to women in the treatment villages. Recruiters hired by the researchers held three in-depth information sessions and provided three years of continuous placement support to women.