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Caste-Based Disparities in IT Sector
Context:
India’s IT sector, contributing over 7% to the country’s GDP, is one of the fastest-growing industries and a global leader in software exports.
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- Its high-paying, performance-driven jobs make it a preferred career destination for millions of Indian youth.
- Often celebrated as a symbol of skill-based meritocracy and inclusivity, the sector claims to hire based on talent, irrespective of social background.
- However, an analysis of employment and wage data reveals a different reality, with stark caste-based disparities persisting in the job market.
Evidence of Caste-Based Inequality
- An analysis of household surveys conducted by the National Sample Survey Office (NSSO) challenges the inclusivity narrative of the IT industry.
- The study, using data from the NSS 68th round (2011-12) and the NSS 78th round (2020-21), highlights significant caste-based disparities in employment probabilities and wage earnings within the sector.
- Among 29,289 individuals surveyed, it was found that Scheduled Castes (SC) and Scheduled Tribes (ST) had only a 10% probability of being employed in the IT sector, compared to 27% for upper castes.
- This disparity persists even after controlling for educational attainment, gender, and regional backgrounds.
- The gap in employment probabilities has widened over time.
- In 2011-12, lower caste groups faced a 6% likelihood of employment in IT compared to 17% for upper castes.
- By 2020-21, this deficit had increased to 17%, suggesting that the sector’s growth has failed to address or even acknowledge social barriers excluding marginalised groups.
- Furthermore, lower caste workers who do secure IT jobs face wage disparities, earning 24.9% (SC) and 22.5% (Other Backward Classes) less than their upper-caste counterparts, despite similar qualifications and job types.
Gender Inequality in the IT Sector
- The study also reveals significant gender disparities in wages within the IT sector.
- Female employees earn 26.2% less than male counterparts, irrespective of caste, despite their employment probabilities being closer to those of men.
- These findings highlight structural barriers faced by marginalised groups and women, reflecting broader trends of labor market segmentation where certain groups are relegated to lower segments with limited opportunities for upward mobility.
Implications for Social Justice and Economic Growth
- The systemic exclusion of marginalised communities in a high-growth sector like IT has profound socio-economic consequences.
- By limiting the participation and upward mobility of disadvantaged groups, the industry not only sacrifices economic efficiency but also undermines social justice.
- Diversity, widely recognised as a driver of innovation and productivity, remains underutilised in the Indian IT sector.
- Reports by the International Labour Organisation and the Network for Business Sustainability underscore that greater workplace diversity enhances productivity and innovation.
- However, the reluctance of India’s IT sector to embrace diversity risks stifling sustainable growth and discourages marginalised communities from investing in education and skill development.
Policy Recommendations
- Workforce Diversity Transparency: Companies should publicly disclose their workforce diversity data on their websites. This transparency can encourage accountability and motivate employers to prioritise diversity without imposing quotas.
- Support for Lower-Caste Entrepreneurs: Marginalised entrepreneurs should receive greater incentives and training to enter high-productivity sectors, thereby enhancing their economic participation.
- Bridging the Skill Gap: Focused efforts to provide skill development programs for marginalised communities can create a more equitable and inclusive job market, empowering these groups to compete on an equal footing.
India’s IT sector holds immense potential for driving economic growth and social transformation. However, to truly live up to its promise of inclusivity and meritocracy, the industry must confront and address the deep-rooted inequalities that persist within its workforce. Promoting diversity and equitable opportunities is not just a moral imperative but also a strategic advantage for sustaining growth and innovation in the long run.
