Economic crisis to put more women out of work

Kanaga Raja

Women workers usually feel the brunt of unemployment more than men during times of economic upheaval. This will likely be the case in 2009 as the global recession deepens.

A further 22 million women are expected to fall into unemployment this year as a result of the current global economic crisis, the International Labour Office (ILO) has predicted.

In its annual ‘Global Employment Trends for Women’ released the ILO warned that the global jobs crisis is expected to worsen sharply with the deepening of the recession in 2009.

At the same time, said the ILO, the global economic crisis would place new hurdles in the path toward sustainable and socially equitable growth making decent work for women increasingly more difficult.

The ILO report found that of the 3 billion people employed around the world in 2008, 1.2 billion were women (40.4 percent). It said that in 2009, the global unemployment rate for women could reach 7.4 percent, compared to 7.0 percent for men.

Gender impact

The report said that the gender impact of the economic crisis in terms of unemployment rates is expected to be more detrimental for females than for males in most regions of the world and most clearly in Latin America and the Caribbean.

However, the only regions where unemployment rates are expected to be less detrimental for women are East Asia, the developed economies and the non-EU South Eastern Europe and Commonwealth of Independent States, which had narrower gender gaps in terms of job opportunities prior to the current economic crisis.

“Gender inequality in the world of work has long been with us - but it is likely that it will be exacerbated by the crisis.

In times of economic upheaval, women often experience the negative consequences more rapidly and are slower to enjoy the benefits of recovery.” said ILO Director-General Juan Somavia, in a message for International Women’s Day, commemorated by the ILO on March 6.

“And already before the crisis, the majority of working women were in the informal economy with lower earnings and less social protection,” he added.

Labour market

According to the report, the labour market projections for 2009 show a deterioration in global labour markets for both women and men. To construct its scenarios, the ILO used as the basis the revised economic outlook published by the International Monetary Fund in January 2009, which projected global economic growth for this year at 0.5 percent.

The report presents three scenarios for labour markets in developed and developing economies, focusing on gender differences in the impact of the economic crisis.

Based on current labour market trends, the first scenario would mean that the global unemployment rate may rise to 6.5 percent for women in 2009, and to 6.1 percent for men. Out of the total number of 203 million unemployed, 86 million are women and 118 million are men. For women, this represents an increase of 10 million over the estimated number of unemployed in 2007, and for men the increase would be 14 million.

Economic growth

The second scenario is based on the historical relationship between economic growth and unemployment at times of economic crises. In this scenario, said ILO, the negative impact on male and female unemployment is taken in each country at the time of the largest year-on-year drop in GDP, and this relationship is used to project global and regional unemployment for 2009.

According to the second scenario, the global unemployment rate for women would rise to 7.0 percent, and to 6.5 percent for men, in both cases an increase of 1.0 percentage points over 2007.

Similar to the impact on the unemployment rate for men and women combined, the largest impact on the male unemployment rate is seen in the Developed Economies and the European Union. For women, however, the largest impact on the unemployment rate is seen in Latin America and the Caribbean, reflecting both the sharp slowdown in economic growth and the severely disadvantaged position of women in labour markets in this region.

In the third scenario, the unemployment rate is projected in each country as the rate in 2008 based on the largest change in unemployment for males and females separately since 1991, taking the differences between developed economies and developing economies into account.

Unemployment rate

According to the third scenario, the global unemployment rate would rise to 7.4 percent for women, an increase by 1.5 percentage points over 2007, and to 7.0 percent for men, an increase by 1.4 percent.

In the Developed Economies and the European Union, the female unemployment rate would rise to 7.8 percent, and the male rate would rise to 7.9 percent. This means that according to this scenario, the gender gap in the unemployment rate would almost disappear in this region, said the report.

In terms of the impact on the vulnerable employment rate for 2009, the ILO projected that the rate will be higher for men than for women at the global level. Latin America and the Caribbean can expect to see a more significant impact on the vulnerable employment rate for women than for men.

The report noted that after four consecutive years of decreases, the global unemployment rate increased from 5.7 percent in 2007 to 6.0 percent in 2008. The ranks of the unemployed increased by 13.8 million people between 2007 and 2008, which is the largest year-on-year increase in the period for which global estimates are available. The global number of unemployed in 2008 is estimated at 193 million.

The unemployment rate for women was 6.3 percent in 2008, as compared to a rate of 5.9 percent for men. Between 2007 and 2008, the unemployment rate increased for both men (0.4 percentage points) and women (0.3 percentage points), thus slightly reducing the gender gap in unemployment rates that has been seen in the past decade.

In terms of numbers of unemployed, 112 million out of the total of 193 million are men, and 81 million are women, said the ILO.

The report underscored that even though global male and female labour force participation rates show signs of conversion, the gap is narrowing at a very slow pace and it still amounted to almost 25 percentage points in 2008. Women made up 40.5 percent of the global labour force in 2008, up from 39.9 percent in 1998.

Services sector

“It is clear that, despite the progress made in many regions, far fewer women participate in labour markets than men.”

The ILO also drew attention to gender inequality in sectoral employment. It found that only a small proportion of employed women are working in industry (18.3 percent in 2008, as compared to 26.6 percent of men); the large majority are in agriculture and, increasingly, in the services sector. The services sector accounted for 46.3 percent of all female employment in 2008, as compared to 41.2 percent of male employment.

Overall, women are still over-represented in the agricultural sector. Globally, the share of women employed in agriculture stands at 35.4 percent, as compared to 32.2 percent for men.

The report also highlighted the gap in wages earned by women and those earned by men. It said that recent analyses of labour markets in Europe and Central Asia reached the conclusion that although the reduction of the gender pay gap is a major political objective for governments and the social partners, progress remains slow and the situation has even deteriorated in certain countries.

Less money

Throughout most regions and many occupations, women are paid less money than men for the same job. In a majority of countries, women’s wages represent between 70 percent and 90 percent of men’s wages, with even lower ratios in some Asian and Latin American countries, said the ILO report.

The report by the ITUC, which represents some 170 million workers in 312 affiliated national organizations from 157 countries, revealed that the pay gap between men and women worldwide may be much higher than official government figures.

The ITUC report, which is based on survey results of some 300,000 women and men in 20 countries, puts the global pay gap at up to 22 percent, rather than the 16.5 percent figure taken from official government figures and released by the ITUC last March.

- Third World Network Features