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Paper short abstract:

The paper studies the effect of increase in heat on the labour force participation rate and wages of the workers during the maximum heated months from 1983 to 2024. It reveals a larger fall in the real wage rate for women and Dalits in Indian agriculture with increasing temperature.

Paper long abstract:

Globally, there has been a fall in labour capacity to 90% of the previous decades and with rising heat stress further falls are expected in future (Dunne, Stouffer, & John, 2013). Effect of temperature shocks is reported to be negative, pushing people out of villages, besides dampening earnings in non-agricultural sectors (Neog, 2022). Evidence based on Indian agriculture show falling employment and wages with rising temperature. The paper studies the effect of increase in heat on the labour force participation rate and wages of the workers during the maximum heated months. The variations in the effect across gender, social groups and regions is studied for various industrial classification. We use data on temperature and rainfall from India Meteorological Department and data on the labour statistics from the Employment and Unemployment rounds (1983-84 to 2011-12) and PLFS data from 2017-18 to 2023-24. Professions requiring more outdoor activities have larger exposure to heat than jobs, in some built-in sheds. A social group-wise and gendered analysis is done to see the varying proportion of different social groups in their exposure to heat through occupation. The analysis reveals a larger fall in the real wage rate for women and marginalised social groups (SCs) in agriculture with increasing temperature. The labour force participation rate, however, does not significantly vary with changes in temperature. Thus, people cannot afford to remain out of the labour market because of climatic conditions but their productivity falls.