Poor vs rich women’s work

July 27, 2019

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The writer is an assistant professor of economics at Lums.
The writer is an assistant professor of economics at Lums.

MUCH has been said about women’s low labour force participation (LFP) in Pakistan. This ranges from not just estimates of the rate — an average of 20 per cent in 2018 — but also the reasons for our poor performance vis-à-vis women’s labour supply. Yet, just considering the mean statistics and thinking through the issues for the average woman does not do justice to the issue. This article breaks down women’s LFP by household income; examining the type of work done and barriers faced by each income class, while detailing policy options.

The first striking pattern is that it is U-shaped. This means that while low- and high-income households see women working, middle-income households have the lowest participation rate at just 13pc.

In fact, the bottom fifth of households have the highest female LFP (FLFP) at 22pc, going up to 25pc in rural Pakistan. This is unsurprising as the poorest households undoubtedly have the highest need. A closer look at the kind of work reveals that it is mostly in the agricultural sector, and largely as unpaid family help. In some ways this is predictable — these women have low average education and so not many skills that the labour market outside of agriculture demands. What is of concern is that, despite providing much-needed help on their family farm or other business, they are not sharing in the profits. This has far-reaching consequences on the value that is placed on women’s work, their status, and often leaves them as the poorest members of their respective households.

Regardless of income strata, a hostile working environment serves as a major deterrent for all women.

Of course, the approximation of an FLFP of 22pc for poor women is likely a severe underestimate as it fails to account for work in the informal sector. Indeed, outside of agriculture, it is the informal sector that sees a large proportion of working women from low-income households. This is especially true in urban Pakistan where poor, uneducated women make up the bulk of domestic workers — estimated at 8.5 to 11 million workers. And while here at least women’s work is remunerated, it is frequently below minimum wage, with poor if any benefits (even paid sick leave), and is oftentimes hazardous.

Thus, when it comes to women from low-income households, it is lack of skills and poor education that seems to be the primary barrier to earning better. In this, Pakistan Skills Development Fund’s initiative for promoting vocational training becomes important. Here, though, we need to make sure that the skills are high value-added if we are to have any significant impact on earning capacities. Moreover, it is not enough to imbue skills. Rather, it is important to integrate these women into supply chains and build their networks of access.

With a higher educational achievement than that of low-income households, women in the middle-income strata certainly have a larger skill-set and likely see greater demand across different sectors. However, a primary reason for their low LFP is mobility restrictions. Typically, such households do not face dire economic need, and in the face of conservative social norms can afford to have their women out of the labour force. Where economic need rises, limited mobility implies that they tend to work from home.

And although working women from middle-income households usually earn better than their poorer counterparts, the reliance on male kin to access labour and credit markets due to their own mobility constraints limits their earnings. Further, the dependence on men means that the income does not come directly into the woman’s hands. In this, digital wallets could help better women’s access to financial instruments. Moreover, improved transport including women-only buses, well-lit city landscapes and safer walking spaces, and media campaigns highlighting role models of working women could help reduce the stigma attached to women venturing out of their homes. All this would not just enrich earnings for those already in the labour market, but could also help propel others to participate.

Finally, while women from the richer income strata tend to work more than those in the middle, the top fifth income quintile still sees a participation rate of only 16pc. Being the most educated, women from this class likely have the requisite skills demanded by better-paid occupational categories. And although their families may not need them to work, economic theory suggests that the lost wages and a failure to recoup the high investment of education should make it too costly for them to stay out of the labour market.

A high household work burden could be a possible reason for not working. But a higher household income also implies a greater ability to hire help. Another reason is a marriage market that places a premium on women who are highly educated but stay at home once they are mothers. For such women in particular, the proliferation of the internet and the advent of both web-based start-ups as well as remote work stations in recent years provide an option of working in high-value-added jobs from home.

Regardless of income strata, a hostile working environment for women serves as a major deterrent for all. For some it keeps them out of the labour market altogether, while for others it cuts short their time at the workplace. For those who must work, poor working conditions mean a substantial fall in the overall sense of well-being.

Legislation such as the Punjab Domestic Workers Act, 2019, which provides provisions for minimum wage, maternity and sick leave amongst others, and the Protection against Harassment of Women at Workplace, 2010, are steps in the right direction, but are not enough. Further interventions such as more flexible work hours, improved maternity and childcare provisions, a reduction in the gender pay and other benefits gap, are needed. After all, it is only through concerted, wide-ranging mediations that we can get women from all walks of life to enter and stay in the labour force.

The writer is an assistant professor of economics at Lums.
hadia.majid@lums.edu.pk

Published in Dawn, July 27th, 2019