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Inclusive growth?

Pakistan’s Vision 2025 echoes the same commitment to inclusive and sustainable growth as is stated in the Sustainable Development Goals. Inclusive growth carries with it the promise that the material prosperity of high economic growth will be shared evenly among various groups.

For the vast majority, a paid job is the primary means to access many of growth’s benefits. Moreover, differences in pay structure, contracts, and even prestige mean that the sector of work matters. In particular, paid work in the formal sector and status as a permanent employee carries with it the greatest possibility of having a real impact on economic and social outcomes. Especially for women, such employment has been linked with weakening restrictive gender stereotypes.

The growth performance of the three main sectors of the economy — agriculture, industry, and services — since 1990, and the associated changes in male and female employment, provide useful insights into the differentiated manner in which the genders have benefited from growth in Pakistan. Some key patterns immediately stand out.

Female industrial workers seem to be bearing the brunt of recessionary forces. While the first half of the turn of the millennium saw remarkable spikes in industry growth owing in part to a rise in demand due to increases in consumer credit services and reduced quota restrictions in textiles and clothing, the subsequent energy, financial, and law and order crises resulted in a substantial slump after 2007.

Women’s employment responses reveal that their status is typically inferior to that of men.

This slump saw women exiting industrial employment faster than men, suggesting that employers tend to lay off female workers before letting male workers go. This, along with the high percentage of women in casual contracts in manufacturing — 89pc for women as opposed to 47pc for men — that offer no social security, old-age, or health benefits, speaks about the inferior status of female workers in Pakistan’s manufacturing sector.

This secondary status of female workers is reflected in services as well. Rapid urbanisation and overall lower investment requirements have seen services command an increasingly larger share of Pakistan’s GDP over the years. Additionally, given the plethora of activities under the sector — from transport to communications to recreation — services, unlike manufacturing, demand not just skilled but unskilled and semi-skilled workers as well. It is perhaps unsurprising that there are more women concentrated in services as opposed to manufacturing.

Aside from the larger range of skill requirement, dominant gender roles also have a part to play. Services include occupations deemed more appropriate for women’s employment, ie those perceived as extensions of ‘caring’ roles such as teaching, nursing, and domestic work. When it comes to gendered employment responses to growth, not only did men see larger increases in their employment fortunes when services’ growth picked up after the turn of the millennium, but women witnessed a much steeper fall-off in employment when the sector’s growth began to decline in 2007.

Interestingly, around the mid-1990s, when structural adjustment likely saw employment losses in the formal sector, services witnessed a boost in women’s employment. This is consistent with women’s work serving as a buffer during times of crises, supplementing fledgling household income. Such sale of labour signals vulnerability rather than long-term engagement with the labour market.

Turning finally to agriculture, despite the highest concentration of women in the sector — nearly 75pc of all employed women work in agriculture — as well as the larger share of female workers relative to male, post-2007 still witnessed a greater reduction in women’s employment relative to men. Yet we also see that, as agriculture growth rates picked up in 2009, it was women who saw a sharper increase in their employment.

While this feminisation of agriculture means that there are more women working outside their homes, it is worrisome. Not only does agriculture typically have the lowest wage rates amongst the three major sectors, 76pc of women work as unpaid family help, ie they do not get paid at all.

Overall, although there have been positive gains in women’s participation rates — that today are 85pc higher than they were in 1990 — we are still unlikely to reach the 45pc target for women’s labour force participation included in Vision 2025. Moreover, a closer look at women’s employment responses reveals that their status within the labour market is typically inferior to that of men.

None of this augurs well for employment as a means for socioeconomic empowerment for women.

It could be argued that lower educational achievement, and by extension the skill level of women relative to men, could be a reason for their lower standing. Indeed, the incidence of casual contracts reduces as education attainment increases. Human capital accumulation of the labour force may allow both men and women to reap the benefits of increased material prosperity. However, this investment needs to set in far earlier than vocational skills’ development. The provision of school meals, stipends for girls, safe transport and more flexible school hours are all attractive policy options.

But education alone is unlikely to address the root causes of the differences in growth’s dividends. Increasing the visibility of women and their various contributions to the economy and wider society may be a crucial step. This concerns a role for the media, government and private sectors. Affirmative action, but also the provision of childcare facilities, are relevant policy options.

Finally, access to paid employment alone is not enough to ensure improvements in women’s status both within and outside the home. Employment must be coupled with guarantees of a minimum income, and affordable and quality public services. While the establishment of income support programmes such as the Benazir Income Support Programme are a step in the right direction, paradigm shifts regarding social protection in Pakistan are yet to come.

The writer is an assistant professor in economics at Lums.

Hadia Majid, "Inclusive growth?," Dawn. 2017-03-20.
Keywords: Employment , Employment issues , Employment policy , Sustainable growth , Sustainable development goals , Material prosperity , Economic growth , Growth’s benefits , Pay structure , Formal sector , Permanent employee , Social outcomes , Restrictive gender stereotypes , Growth performance , Female employment , Recessionary forces , Industry growth , Industrial employment , Casual contracts , Social security , Health benefits , Manufacturing Sector , Semi-skilled workers , Dominant gender roles , Domestic work , Structural adjustment , Employment losses , Labour market , Women’s employment relative , Agriculture growth rates , Socioeconomic empowerment , Educational achievement , Labour force , Vocational skills , School meals , Policy options , Growth’s dividends , Wider society , Childcare facilities , public services , Benazir Income Support Programme , Social protection