Global recession: Women may be more vulnerable

JULY 20, 2009

By Savithri Subramaniam

A recent statement by the United Nations Conference for Trade and Development (UNCTAD) has significant implications.  It says, ”The subject of trade and gender is now of particular relevance because of the current economic crisis. As female labour has been fueling a large share of the recent increase in trade, women are possibly the first to suffer from the world economic downturn.” This article tries to explore how and why women may be more disadvantaged in the current economic scenario. And further, how these gender-based vulnerabilities can be reduced in the future.

The article is based on the premise that gender equality is an important goal as set out in the Millennium Development Goals (MDGs). They are eight goals to be achieved by 2015 that respond to the world's main development challenges. The MDGs are drawn from the actions and targets contained in the Millennium Declaration that was adopted by 189 nations-and signed by 147 heads of state and governments during the UN Millennium Summit in September 2000.

The Millennium Development Goal No 3 is:

Promote gender equality and empower women

Women make a substantial contribution to a country's economy and the economy of its households in a microcosm though this fact is often not very visible. As stated by UNCTAD, “Gender inequalities undermine people's well-being, diminish prospects for economic growth and make economies less efficient.   Gender equality is a legitimate goal in itself, as better opportunities for women lead to improvements in human development.” Since women in many countries face a number of disadvantages and marginalisation it is important to understand the gender impact of global changes and trends such as the present slowdown and recession.

While discussing the increased vulnerability of women in times of economic crisis, it is important to first understand how women may be unequally placed vis-ŕ-vis men in economic activities, especially in the context of a globalising economy. In developing countries larger numbers of women are employed in informal sector and are disadvantaged in terms of income and other rights of workers. The barriers to women's entrepreneurship in different countries have also been well researched.

A number of studies have brought out that in a patriarchal context; women are exploited or marginalised in the economic sphere. Now in times of global transformational trends such as the present economic crisis there is a chance of this getting worse. They are less educated and often they are also illiterate or semi-literate. They are also less likely to own land or any other income-generating assets. Women may receive less pay and have even lesser job security than men. More women work in the informal sector and undertake work which is outside the purview of any labour laws or social security benefits. Given their responsibility of household chores, maternity and child care this places an extreme burden on them.

In a remarkably high proportion of households, women are the main bread winners of their family. This fact may be hidden in houses where there are adult men. In poor households men may not contribute much to the household expenditure and it is in these conditions that women begin to work. And female-headed households are also large in number in India and many other developing countries. Given the kind of responsibilities women have to bear, many have advocated that it is crucial that social security measures look at their needs sensitively.

The gendered nature of money and labour has also been the subject of research. The responsibility that a woman is expected to have towards her family and children mark her earnings as different from that of a man. Her money and her labour are meant to fulfil others' needs. Thus, even when she is the sole earner in the household her income does not allow the scope for self-indulgence found in the case of men. This effectively devalues her monetary contribution through work outside the house. Further, most of her labour contribution at home is also devalued by being ‘invisible' or taken for granted and is rarely ever linked to the economic capital a household builds.  

Also in scenarios where men lose their jobs the burden increases on women. They have to start and/or intensify their own economic activities. In such situations, they also have to try and save more money and stringently manage household budgets. A recent, almost anecdotal development is reported by the magazine India Today. It states how women are looking for alternatives when they or their husbands lose their jobs. The increasing problem of infertility among married couples in India seems to provide them an opportunity to be egg donors and also surrogate mothers even for couples from other countries and earn good money. Though limited in its coverage such studies are nevertheless important as they give us rare data on the Indian context and the impact of the downturn on women here.

Growth in global trade has surely given an opportunity for women's empowerment and improvement in livelihood as noted in economies across the globe. This has happened in several ways including rising employment opportunities, improved income levels and entrepreneurial opportunities.

However, trade policies are not made keeping gender issues in mind; this is true for liberalisation and globalisation as well. The impact may be seen in labour markets as often women are found working in the informal sector, in industry and agriculture or are part of micro or small enterprises that tend to get affected by global changes. This is particularly true in the Asia-pacific region as found by several studies of United Nations agencies including the UN Economic and Social Council.

Given this background, it is pertinent to raise the question - does the current trend of crisis and recession affect women more? Given below is what some of the recent studies suggest.

According to UNCTAD, due to rapid growth in exports at the beginning of the new millennium, women have been heavily employed in the export sector, accounting for as many as 80 per cent of the textile industry workforce in developing countries and making them vulnerable to the turmoil in global trading. UNCTAD estimates that merchandise exports from developing countries could drop by 15.5 per cent in 2009, which the secretary general of UNCTAD considers is an optimistic forecast. This in turn will severely affect women's employment and incomes in these countries.

The International Labour Organisation has  recently projected that global unemployment rate could reach between 6.3 per cent and 7.1 per cent, with a corresponding female unemployment rate ranging from 6.5 to 7.4 per cent compared to 6.1 per cent to 7.0 per cent for men.

Some studies suggest a different trend. The research study conducted by Accenture consulting firm ‘Untapped Potential: Stretching toward the Future' surveyed 3,600 professionals from medium to large organisations in 18 countries between November and December last year. Women (about 61%) in India felt in larger numbers compared to women of some other countries and Indian men that they would be secure in their jobs and have better career prospects despite the current economic downturn. They were also willing to take on new responsibilities and even develop new skills. But this study does not cover the majority who are in informal sectors or in small organisations whom the global economic downturn is really affecting.

The Director of UN Economic and Social Commission for Asia and the Pacific's Social Development Division states that in many families, household expenditures, such as for food and child-rearing, are managed by women.

“Women dependents are having to care for their entire families on less income, and working women are having to support families with their wages alone, which, on average, are lower often considerably than men's. On top of that food prices have spiraled over the last two years, forcing women to make difficult financial choices. And where school costs become unbearable, it is the girl-children who are more likely to be taken out of the classroom.”

United Nations Development Programme (UNDP) reports that after a decade of high growth, driven by the manufacturing, construction, and tourism sectors, the Cambodian economy is predicted to contract significantly in 2009. it is also evident that women will be disproportionally affected by this crisis ashey make up the bulk of the labour force.  

Based on a ten country research study report in March 2009, Oxfam states, Developing countries' exports in light manufacturing are falling.  This has a major impact on women: In recent years millions of women have found work in export-oriented manufacturing in East Asia and Latin America. Many of these jobs are substandard, with little job security or labour rights. Now the crisis is making things worse - and having a devastating impact on their livelihoods, their rights and their families. Oxfam's research shows that women are often first to be laid off, with employers refusing to pay outstanding wages and evading legal obligations to give notice and pay compensation. Many governments are turning a blind eye to these practices. 

Thus, there is definitely a strong negative impact of the present global economic trends on women particularly in developing countries. Efforts have to be made, both by government and industry, to diminish this impact. There are some recommendations on how the negative gender based impact of changes in the global economy can be reduced in future.  Gender mainstreaming in trade and related policies and gender assessments are quite important in this context. UNCTAD suggests Gender assessments will first help governments to better design complementary policies aimed to reduce any negative effect of trade policies on women and will also guide policymakers in designing policies aimed to help women to better benefit from trade liberalisation.

The contribution of women in the country's economy needs to be understood and given its due. This will help to design economic and labour policies beneficial to both genders. Further, existing social security measures and regulations need to be implemented without any discrimination towards women. Policies must be sensitive to the reality that more often than not women have a larger share of the burdensome task of managing the household economy. When measures are taken so that women and men can access economic opportunities equitably in times of economic growth, then countries would be better placed to ensure that women are not badly affected in times of crisis.

(The author is consultant to a UN body)