Jill RuberyManchester Business School

Regulation and Gender Equality

Task for the World Bank Review the labour market regulation/labour market

flexibility debate with respect to its implications for female labour market participation and gender equality

Focus on developed economies (my expertise and the prime focus of the debate) but extend also to transition and developing economies.

Conclude by considering how regulations may be used to promote gender equality.

Additional task for today Consider implications for the supporting jobs into recovery

agenda

Outline of talk 1. Why focus on gender issues within regulation

debate?2. Key review findings: developed economies

Gender mainstreaming specific policy analyses

3. Key review findings with respect to developing economies

4. Outline of approach for reregulating for gender equality

5. Implications for policy to support jobs out of the recovery for women

1. Why focus on gender issues within regulation debate?

Gender equality issues are taking on a higher profile within the OECD flexibility debates

Regulation recognised as not incompatible with good overall employment performance- argument now focused on adjustment to shocks and impact on employment composition.

Vulnerable groups associated with outsider status Women seen as ‘outsiders’ - excluded by regulations that

promote longer term employment relationships/labour hoarding and regulations which raise costs/reduce job creation.

Testing for gender effects in cross national pooled time series data

2. Key review findings: developed economies In reality testing for sex effects not gender

searching for cross national and cross time underlying differences in labour market experiences by sex

differences in gender regimes captured by country fixed effects.

Recognition that labour market regulation explains very little of evolution of female employment

Impact of gender-specific regulations (tax on part-time work, tax on second income earners) stronger than general labour market regulation effects.

b Gender employment rate 2008

a Employment protection legislation 2003

)

Source: OECD (2004) and OECD (2009)

Figure 3.1 Index of employment protection legislation scores (2003) and female employment rate 2008 by country

2. Key review findings: developed economies Results, even within this framework, mixed and inconclusive

Stronger for relative unemployment than for relative employment – but raises issue of whether women without work have same propensity to regard themselves as unemployed rather than non employed across countries

Different impacts on female full-time and female part-time work

Sensitive to selection of countries included

Presumption that labour market policies interact in same way with sex/gender across countries ( but entitlements to benefits differ, union policies differ)

More attention to levels of regulation than to coverage and asymmetries

Regulation indices do not take account of differential effects by gender across the components- for example the Rigidity of Hours index within the Doing Business Index or the extent of asymmetry within the Employment Protection Legislation Index

Limited number of studies- but multiple references –evidence thin as well as mixed.

2. Gender mainstreaming specific policy aeas: ‘The devil is in the detail’ Cross national policy by policy analysis does not allow for: Differences in interactions related to differences in gender regimes

across countries- for example differences in social attitudes, working time preferences, continuity of employment, household systems of welfare and taxation, relationships to trade unions and collective bargaining etc.

Differences in interactions related to differences in the specifics of particular policies (differences in coverage, in orientations, in eligibility conditions)

Differences in interactions with gender related to differences in institutional regimes-impact of policies depend on bundles of policies – on different paths or logics of capitalism not on incremental policy by policy change.

Considered nine policy areas: employment protection, working time, unemployment, active labour market policies, trade unions and wage setting, minimum wages, product market regulation, tax regimes, mobility policies (transport and housing).

EmploymentRegulation

Standard gender analysis Gender mainstreaming analysis

Employment protection legislation

Women re-entrants excluded due to limited vacancies, particularly if women concentrated in cyclically volatile sectors.Restrictions on non standard employment/ part-time reduce participation

More employment protection may stabilize women’s employment sectors, reducing women’s labour market flows and leading to greater continuity An alternative policy choice is to enable women also to be insiders- through supportive childcare and leave policiesDemand for part-time working varies between countries; promotion of part-time will not necessarily mobilise more women into employment.

Working time regulations

Regulations that reduce employer’s right to offer flexible/part-time jobs may reduce jobs available to women

May also occur if employers required to offer part-time and leave options, raising employment costs.

No assumed impact form full-time regulations

Unregulated full-time work may mean that i) partners are unable to share in childcare, ii) women are unable work full-time due to long/unpredictable hoursiii) part-time work is not available in jobs where full-timers work variable and/or excessive hours. Part-time work opportunities not necessarily welcomed where incomes are low (developing countries)Employer-oriented part-time work may lead to segmentation / employee-oriented part-time work may enable continuity of employment and job statusPart-time work may be associated with lower non wage benefits

Employment

regulation

Standard gender analysis Gender mainstreaming

Unemployment benefits

Assume women as eligible as men for benefits and thus equally/more affected by high benefits

Women’s reservation wage only effected if eligible for benefits-variations by system related to thresholds for contributions by duration/hours/ family means testing . Household means-tested benefits (e.g. in work tax credits) may disincentivise second income earners

Active labour market policies

Assumed gender neutral Issue of women’s access to schemes linked to unemployment benefits often not recognised – ALMPS may reinforce occupational segregation and employers may discriminate against women in work placements.

Trade unions and the structure of collective bargaining

Impact of high wages leads either to exclusion or to lower job creation in female sectors.Pay improvements offset by employment effects.

Decentralised bargaining associated with wider wage inequality.Decentralised wage determination may increase wage discrimination against women as share of unexplained wage differentials appears to be rising.

Minimum wages

a) Developed economies- reduces female employment in formal sector;

b) Developing economies – indirect effects from increased labour supply to informal sector .

Developed economies: assumption of market clearing wage challenged by evidence of monopsony, gender pay discrimination, limited access to unemployment insurance In developing economies minimum wage may influence ‘reservation wages’ in informal sector

Other regulations

Standard gender effects Gender mainstreaming

Product market regulation

Women may be a) employed in more

competitive industries than men outside of strict PMR or

b) PMR may be restricting new job creation.

Product market deregulation may not only impact on highly privileged insiders but may widen wage inequality and increase job insecurity at the bottom (e.g. when introduced in public services) .

Taxes High tax wedge assumed to disadvantage low paid, in price elastic sectors

Informality attributed to tax wedge buti) household based social protection ii) low benefits for part-timer/intermittent participants

may increase supply of women willing to work outside social protection.

Exemptions from tax/social protection for some part-time jobs may create segmentation between full and part-time job

Incentives to mobility and housing policies

Focus is on mobility of main breadwinner.

Mobility issues for women kick in at a much shorter distance from home due to stronger domestic commitments/ more limited access to transport- job mismatches due to limited local mobility not considered.

Country Male Female

Spain 34.6 15.9

Greece 13.6 9.4

Italy 4.3 3.3

France 51.0 40.6

Belgium 79.9 74.0

Luxembourg 22.2 17.9

Germany 68.7 69.4

Denmark 85.8 83.7

Portugal 26.9 23.4

Finland 79.7 75.4

Austria 59.5 43.5

Ireland 87.9 44.9

UK 33.3 17.2

Table 4.1 Benefit receipt among the unemployed and the gender gap

Note: based on European Community Household Panel Survey – the question asked is ‘Do you receive unemployment benefit or assistance?’Source: Azmat et al. 2006

3. Key findings with respect to developing economies

Some cross national studies mix developed and developing economies Is it possible/sensible to seek to find a common relationship between

regulation and gender employment patterns in such a diverse country set? Weak or non existent effects by gender in some of these studies, e.g.Botero

et al. 2004 Some single country/ region specific studies find regulation has negative

effects on employment /women but timing sometimes mismatched e.g. Argentina

More promising to look at regime types (Abu Sharkh ILO)- particularly between systems with strong versus weak family structures.

3. Developing country specific approaches: Analyses need to be multi-sectoral, family and community-specific , sensitive to

globalization

Regulating with a large informal sector Some feminized areas all within informal sector- not just an issue of promoting

labour mobility into formal sector but of formalizing economic activity Any displacement effects from regulation/ minimum wages need to b e

analyzed through a gender lens- segregation within as well as between sectors.

Minimum wage may act as reference point for fair wages in informal sector More important to develop social protection covering informal sector as well as

formal than EPL

Regulating under globalization Scope for action to improve employment conditions depends on how footloose

FDI actually is- positive examples depend on active commitment by MNCs

.

 

4. Re-regulating for gender equality

Gender is a social constructRegulation debate takes gender difference as a

given- as sex differenceAim of regulation Reduce gender difference in labour supply Create more inclusive labour markets- reduce

differentiation between female- and male-dominated workplaces

Non standard work patterns Overlapping work patterns Full-time continuous work patterns

Standard female biographyDiscontinuous work patternsPart-time/flexible workEducation/training for female jobsTax/benefit disincentives to participation/extra hoursDerived welfare rights

Policies for homogenisationCONTINUITYECONOMIC

INDEPENDENCEACCESS TO TRAINING

Standard male biographyContinuous employmentLong/full-time workEducation/training and/or firm specific training for male jobsTax/benefit incentive to be breadwinner

A MORE GENDER INCLUSIVE LABOUR MARKET

Female jobs/sectorsGender segregation by working time, occupation, firm, sector Low pay /low training opportunities/ low social protection coverage/ low employment protection coverage

Policies for integrationINCLUSIVE EMPLOYMENT AND

SOCIAL PROTECTIONINCLUSIVE WAGE SETTINGFLEXIBLE WORK OPTIONS/TRAINING OPPORTUNTIES ACROSS LABOUR MARKET

Male jobs/sectorsFull-time work, covered by EPL, collective bargaining, firm-specific training, social protection

Segmented labour market- periphery

Integrated labour market Segmented labour market – exclusive core

5. Implications for policy to support jobs out of the recovery for women: Lessons from this review Avoid gender stereotypes i.e. women as contingent labour Many women are breadwinners or income vital for their own and family

subsistence Contingency may be reinforced by other policies such as household-based tax

and welfare policies

Gender segregation matters Women may benefit from stabilisation of employment through regulation/ not

always vulnerable to exclusion

Country, regulatory and gender regime matter- not one size fits all Differences in extent of gender difference in employment continuity, hours,

access to social protection, coverage by trade unions/collective bargaining etc.

Regulation for inclusion not just exclusion Form of regulation matters and in particular extent of coverage but absence of

regulation does not generate inclusiveness Extend employment codes/ social protection to non standard and informal

workers Coverage of policies to stabilise employment or to redeploy/retrain must include

female-dominated as well as male dominated segments

Policies should be individual not household based Otherwise women likely to be excluded/ face problems of withdrawal of support

if improve own employment position

Conclusions Doom mongers’ predictions of impact of

regulations not borne out before- women’s employment has risen despite new regulations

Regulations may act to protect status quo/insiders but also stabilise employment/reduce risks

Deregulated labour markets may intensify gender differences- and women interested in quality not just quantity of employment

Need a new positive agenda to address multiple dimensions of women’s inequality

Aim should be to reduce women’s role as outsiders -not regard gender difference as a biological/ inevitable characteristic.