Research

The project: Labor-intensive manufacturing is growing rapidly in developing countries. Yet significant wage gaps exist both across geographic and gender boundaries: the urban-rural wage gap is as high as 45% in some areas of India. Industries that specifically carry disproportionate amounts of female employees, such as garment production, could provide a way to enhance successful migration and provide important job skills, and thus begin to narrow gender and wage gaps in labor participation. This project aimed to analyze and address methods to alleviate the barriers to successful rural-to-urban migration for women.

The process: Partnered with one of the world’s largest garment manufacturers in India, researchers planned to run a randomized controlled trial that aimed to facilitate Indian women’s rural-urban migration and assess impacts on the well-being of workers and their families. In 2019, four vocational training centers were established at randomized locations across the Indian state of Karnataka. The centers provided vocational skills and a guaranteed employment match in urban Bangalore following training for more than 1,000 women. The COVID-19 pandemic disrupted operations in the training centers, women’s migration decisions, and researchers’ ability to conduct follow-up surveys with women who had completed the vocational training. As a result, researchers focused on analyzing data from a 2017 baseline survey, initial uptake of the vocational training, and a rapid response survey fielded in the summer of 2020.

Results:

• Initial uptake of vocational training was low. Overall, among households with eligible women in 12 villages, the take-up or participation rate at the four vocational training centers is 8.2%.
• Determinants of training uptake: Households with more prime-age women (18-35 years old), especially those with more unmarried women, are more inclined to participate. Households in urgent demand for money were more likely to participate. And households that face less competing demands for women’s time – for example, those who do not need women to fetch water – are more likely to participate.
• COVID-19 economic impact: Researchers contacted 1,815 households in the rural areas of Karnataka and Andhra Pradesh in May-August 2020 to survey them about their experiences during the pandemic. The survey responses show that the pandemic, which began as a health crisis, has in time triggered an economic crisis for the poor and vulnerable. Furthermore, it has led to huge trend of reverse migration from urban to rural areas and negatively impacted the prospects of placement-linked skill development programs.

Achyuta Adhvaryu, U-M Ross School of Business
Anant Nyshadham, Boston College Department of Economics
Huayu Xu, U-M Department of Economics