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The Gender Perspectives of the Global Crisis of 2008

Raj Nallari's picture

This is a summary of materials available from ILO and World Bank.

The financial and economic crises of 2008 had gender-specific impacts and placed a disproportionate burden on women, in particular poor, migrant and minority women. Even though both women and men are affected by job losses, women are often laid off first, as men are traditionally considered to be the main “breadwinners”. Some of the implications of the global financial and economic crisis on women are:

  • Lower wages: Women are at a risk of losing their jobs first and are often do not have much negotiating power. Low wages, particularly in countries without social safety nets, makes the impact on women even more severe.
  • Greater unemployment: Employment losses or a slowdown in job growth is expected to contribute to growing unemployment. This finds women at the risk of being hired last and dismissed first.

  • Drop in remittances: Developing countries will be affected by the drop in remittances from family members in developed economies. Remittances give women greater autonomy and control over family matters.

  • Drop in informal sector demand: Women in the informal sector, including agricultural laborers, home-workers, traditional artisans, weavers and vendors, are particularly affected, as economic crises tend to significantly reduce the demand for outputs produced in this sector.

  • Drop in access to finance: Women are the majority of clients of micro finance institutions (85% of the poorest 93 million clients of MFIs in 2006)[1]and their access to such credit is expected to decline owing to the liquidity problems in the financial sector. This is significant particularly in Latin America and ECA, where micro finance institutions obtain a significant portion of their lending from commercial rather than concessional (grant) sources.[2]

  • Increased stress and violence: As food and fuel prices soar, adding stress and hardship to families, incidents of violence against women and communal violence increase.

The manner in which countries use monetary and fiscal policies to respond to recessions can also lead to disproportionate impacts on women and girls. The effects on women and therefore children will be transmitted through cuts in public sector budgets, due to falling tax revenues and foreign aid. Cuts in public spending in the areas of health and education, for example, can reduce women’s and girls’ access to basic services. Girls may be withdrawn from schools to help with household work during times of economic crisis, reinforcing gender gaps in education. These coping strategies can undermine the long-term development for the society as a whole. Increasing unemployment and decreasing household incomes increases unpaid work, including care giving, mostly done by women and girls, and may force women to turn to vulnerable and informal employment.

Unemployment

In terms of numbers of unemployed, in 2008, 112 million out of the total of 193 million are men, and 81 million are women. The International Labor Office (ILO)[3] estimates that the economic crisis is expected to increase the number of unemployed women by up to 22 million over the period 2007- 2009. The unemployment rate for women was 6.3 per cent in 2008 and is expected to rise to at least 6.5 per cent in the most optimistic scenario, and to 7.4 per cent in the most pessimistic scenario. In most regions, the gender impact of the economic crisis in terms of unemployment rates is expected to be more detrimental for females than for males, and most clearly so in Latin America and the Caribbean. Only in East Asia and the Developed Economies and the European Union, both regions with limited gender gaps in terms of employment opportunities, the opposite is true. In the developed economies, male unemployment may reach 7.9 per cent, hardly different from the 7.8 rate for women in the worst case scenario for 2009.

Remittances

Remittances constitute between 40 and 17 percent of GDP for many countries, including Moldova, Tajikistan, Tonga, Lebanon, Lesotho, Honduras, Guyana, Haiti, Jamaica, Jordan, El Salvador, Nicaragua, and Nepal. Women migrants are traditionally in “female” occupations such as domestic work and nursing and are more vulnerable to economic downturns. Accurate figures for job losses by immigrant workers are difficult to compile, though some idea of its magnitude can be gauged by anecdotes. For example, in the metropolitan area of New York, where financial sector job loss reached about 80,000, the New York Times estimated that at least half as many domestic workers also lost their jobs[4]. Job losses are projected to be the most for domestic workers from the Philippines, Caribbean countries, and Eastern Europe who care for the elderly and children in the Arab countries, United States and Western Europe.

Policy Response:

Gender equality should be a key principle in any policy response to help offset the unequal social and economic burden on women. The crisis is an opportunity to drive new ways of thinking on economic and social policies. When governments design and implement fiscal stimulus packages, it is important to recognize the labor market disadvantage that women face and to consider explicit employment growth targets for women. In this context, considerations in the design of an appropriate policy mix will have the following elements:

  1. Gender sensitive employment creation: The fiscal stimulus packages should go beyond a focus on job creation in mostly male-dominated sectors, such as construction. There is a need for greater gender-responsiveness through labor based approaches that includes more women. Investing in rural infrastructure creates employment and builds a foundation for sustainable growth. Furthering poverty alleviation through the construction and repairs of farm-to-market roads, post-harvest facilities, irrigation systems, portable water systems and other farm projects, will provide long-term advantages to a large percentage of women in agriculture, in particular those in vulnerable employment. It will also serve to provide opportunities for those migrants returning to the countryside and working as subsistence farmers.
  2. Investment in “social infrastructure”: Fiscal stimulus packages to also include initiatives in education and healthcare that would inject financial and human capital into fields with high female employment, and ultimately increase human capital and growth
  3. Increase in credit lines to women: Governments should subsidize credit for women and guarantee loans that foster job creation for women. Commercial banks that receive liquidity support from central banks should be requested to maintain funding for microcredit, as such credit is vital in the informal sector where large numbers of women work.

 Table 1: Female unemployment scenarios (rates)

Table 2: Female unemployment scenarios (numbers of people)

 

[1] Microcredit Summit Campaign Report 2007 

[2] CGAP, http://www2.cgap.org/p/site/c/template.rc/1.11.12051/1.26.4005(accessed on 6/29/2009)

[3] ILO (March 2009). Global Employment Trends for Women.

 

[4] Antonopoulos, Rania. 2009. The current economic and financial crisis: A gender perspective. Working Paper No. 562. The Levy: Economics Institute of Bard College. May 2009