Understanding The Impact on Livelihood Due to Minimum Wage and Employment: A Detailed Analysis from A Gender Perspective in India

Abstract

This research work seeks to investigate how India's minimum wage affects employment in light of the country's recent implementation of a national minimum wage that applies to the whole economy. This study provides insight into how the national minimum wage affects employment for both men and women, given that women have a lower labour force participation rate and a greater unemployment rate than males.This paper's methodological foundation is a conceptual framework based on Blundell et al. (2007)'s labor-leisure model, which incorporates the minimum wage as a significant variable influencing an individual's employment decision. It makes use of micro data from the Household Survey collected Continuously with Multi-Purpose intention for the years 2021–2022 and implements the difference-in-difference estimate technique.The results show that overall employment is greatly decreased by the minimum wage. Since the national minimum wage was implemented, the likelihood that a worker who is now making less than the minimum wage will continue to be employed is 0.525 less than that of a worker who is making more than the minimum pay. Furthermore, the study shows that women are more negatively impacted by the minimum wage's negative employment consequences than men are, using sex dis-aggregated data. This is an initial attempt to calculate how employment in India will be impacted by the recently implemented national minimum wage. Even though minimum wages have various effects on different sectors of the economy, this study compares how minimum wages affect employment for men and women in order to take a gender perspective.