New Delhi: The implementation and expansion of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has resulted in the decline of the gender wage gap besides increasing compliance with minimum wage regulations in rural areas, the International Labour Organisation (ILO) has found.The findings are from ILO’s latest working paper – Employment and wage disparities between rural and urban areas.According to the paper, the gap in rural wages between formal salaried workers and casual workers has also decreased due to the employment guarantee scheme.“As NREGS was introduced and expanded, the rate of compliance with minimum wage regulations increased, the gap in rural wages between formal salaried workers and casual workers decreased and, similarly, the gender wage gaps in rural areas declined. Alongside other factors, the NREGS programme seems to have played an important role in these positive trends,” Business Standard quoted from the paper.While noting that the scheme has been successful in transforming the lives of the rural populace, the degree of impact varied across the nation depending on its implementation at the field level.The Mahatma Gandhi National Rural Employment Guarantee Act was passed in 2005, and the demand-driven scheme guarantees 100 days of unskilled work per year for every rural household that wants it. Since the Narendra Modi-led government assumed power in 2014, the budgetary allocations for the scheme have been reduced drastically.In 2015, Prime Minister Narendra Modi famously called MGNREGA a “living monument of Congress government’s failure”. In a speech in parliament, he had said, “After so many years in power, all you were able to deliver is for a poor man to dig ditches a few days a month.”The ILO working paper also points to negative trends in the purchasing power of rural Indian wages in recent years. “Drawing on inflation data, together with the rural monthly wage index published by the Indian Labour Bureau, the Ministry of Finance has observed negative trends in the purchasing power of rural Indian wages in recent years. Thus, in its Economic Survey 2022-23, the Ministry highlighted a negative growth in real rural wages (that is, rural wages adjusted for inflation) due to elevated inflation between April and November 2022,” the paper notes.This study uses household survey data from 58 countries around the world to compare the labour market outcomes of rural and urban workers, taking into account the specific socio-demographic characteristics of rural populations. It also provides an overview of the legal frameworks that can be used to address rural-urban employment and wage disparities.Statistical evidence from 58 countries shows that although people in rural areas are more likely to be in employment than those in urban ones, they also tend to have jobs that can put them at risk of experiencing inadequate labour protection as well as low pay.“In particular, rural workers are paid, on average, 24% less than their urban counterparts on an hourly basis, and only half of this gap can be explained by rural-urban discrepancies in education, job experience and occupational category. Developing countries exhibit a relatively wider gap, with the unexplained part also being larger. Furthermore, in many countries, certain groups of rural workers are at greater disadvantage, such as women, who, on average, appear to earn less than men in rural areas. However, institutional and regulatory frameworks, notably those that set minimum wages or seek to promote equal opportunities, can help to reduce labour market-related inequalities across the rural-urban divide,” notes the paper.