Progress or distress? Track the rise of women-led informal businesses

New Budget schemes seek to improve market access, scaling of operations for women-related ventures

The Union Budget on Tuesday pushed for economic empowerment of women.

The government will encourage women’s participation in the workforce through skilling programmes, and it will promote market access for women self-help group enterprises, said Finance Minister Nirmala Sitharaman in her Budget speech.

This comes even as more women have set up their own small unincorporated businesses after the pandemic, shows a Business Standard analysis of data from a government survey seen as a proxy for the informal economy. The share of female-owned proprietary ventures in unincorporated businesses increased to 22.9 per cent in 2022-23. It was 19.5 per cent share in a similar survey conducted in 2015-16. The increase is in both urban and rural areas.

The Annual Survey of Unincorporated Sector Enterprises covers non-agricultural establishments in manufacturing, trade, and ‘other services’. It considers businesses not registered as companies and is one way to understand India’s informal economy. The survey defines a proprietary establishment as one where a single individual is the sole owner of an establishment. Such individuals comprise 95 per cent of unincorporated businesses covered by the survey, and much of the gender data is for proprietary units.

Many women-led businesses do not have any hired workers who are typically paid or unpaid apprentices, paid household members, servants or resident workers. A rise in establishments not employing such workers is seen as a sign of distress. People start such establishments when they can’t find other employment. Since the pandemic, many women have opted for self-employment instead of regular salaried work. More male-owned enterprises have hired workers compared to female-led ones.

Many women have started their own business in manufacturing. The majority (54.7 per cent) of proprietary establishments in manufacturing are now owned by women. Their share in trade is 12.4 per cent while it is 11.1 per cent in other services.  Some states show even higher numbers on manufacturing.

Across initiatives, Sitharaman has said the Budget will spend Rs 3 trillion on “schemes benefitting women and girls”.