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  December 25, 2017

The Cost of Exclusion: Gender Job Segregation Hurts the Working Class

Although women's share of employment in most countries has increased, women's share of the "good" jobs in the industrial sector has declined substantially over the past few decades, and that inequality is creating a weaker working class as a whole, says Stephanie Seguino of the University of Vermont
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Stephanie Seguino is a professor of economics at the University of Vermont and a research scholar at the PERI Institute at the University of Massachusetts Amherst. She is also a Professorial Research Associate at the Department of Development Studies, School of Oriental and African Studies (SOAS) at the University of London.


SHARMINI PERIES: It's The Real News Network. I'm Sharmini Peries coming to you from Baltimore. In the last three decades, the share of women in the workforce has increased throughout the world. Don't get your champagne glasses out yet. We're going to take a closer look at this change by discussing a working paper at the Political Economy Research Institute, PERI, titled "The Cost of Exclusion: Gender Job Segregation, Structural Change and the Labor Share of Income." The authors, Stephanie Seguino and Alyssa Bronstein show how the segregation of women within the industrial sector weakens the overall bargaining of industrial workers.

On to talk about this with me is Stephanie Seguino. She is a professor of economics at the University of Vermont and a research scholar at PERI Institute at University of Massachusetts, Amherst. She's also a professorial research associate at the Department of Development Studies School of Oriental and African Studies, SOAS, at the University of London. Stephanie, good to have you with us.

S. SEGUINO: Thank you for having me.

SHARMINI PERIES: Stephanie let's start at the beginning. What is it you set out to do in this study, and give us some broad strokes in terms of what you found?

S. SEGUINO: We, in this study, wanted to unravel a puzzle. The puzzle we wanted to unravel was that the data show that over the last, since 1991, that there has, women's employment rates relative to men's employment rates have been rising, right? So women's share of employment has been increasing over this period of time. But, at the same time, women's share of good jobs, that is jobs in the industrial sector, has decreased.

It's puzzling for a number of reasons, not the least of which is that educational gaps between men and women have narrowed substantially. So it can't be related to skill. It must be other phenomena that are going on, and we really wanted to unravel and untangle that piece of it, especially because it highlights that the trends we are seeing are gender conflictive, right? That women are doing better in terms of access to jobs but there is a decreasing share of jobs that are good jobs and women are being squeezed out of those jobs.

SHARMINI PERIES: What were the main reasons that women were excluded from the industrial sector jobs?

S. SEGUINO: Sure. One of them was structural change. There is a process of what we call premature de-industrialization, and so we've seen a decline in industrial employment as a percentage of all employment globally as well as industrial value added as a percentage of GDP. That means that there's a smaller number of good jobs and I think that scarcity triggers men and employers to exclude women because of this notion of stratification, that men have more right to good jobs when those jobs are scarce. That was a critical factor.

Another factor was the rising capital-to-labor ratio, meaning more capital-intensive production. There's no reason that that should lead to women being excluded on its face because again, educational gaps have closed, or narrowed substantially, but I think there are, there are complex factors in that. It could be that there is a perception on the part of employers that women are more likely to leave, to have children and so forth and they want workers that are going to be continuous because they're investing in their training. It could be the gender hierarchies, that these are higher quality jobs.

Those were two really critical factors, that structural change in the economy, measured by capital intensity and the growth of industrial sector jobs as a percentage of all jobs. There were some other factors that were really interesting. Weighted tariffs had a positive effect on women's access to industrial sector jobs, and I think that's because especially in developing countries, by being able to impose import tariffs, it preserved industrial sector jobs in these countries. We found government spending has a positive effect on women's share of industrial sector jobs also.

SHARMINI PERIES: So then, how does the increased use of capital in industry, the so-called capital-intensive production, affect the allocation of jobs and income between women and men in countries where the industry is still based on labor-intensive production?

S. SEGUINO: So here's the deal. We wanted to analyze in particular the issues around structural change, whether it's technology or rules around globalization, such as trade and tariffs and FDI and so forth, as well as I said, the overall structural change of the economy in terms of the types of goods that are produced. So we controlled for labor supply factors, women and men's labor force education, participation rates, gender differences in education and once we did that, here's what we found, was that when the percentage of jobs that are in the industrial sector rise, women's share of the industrial sector jobs increases. Why is that important?

Well basically, what's been happening is the opposite, that industrial sector jobs are declining in most countries and this is something that Danny Rodrick and others have called premature de-industrialization. There's increasing scarcity of good jobs, and we kind of rely on a stratification theoretical framework and a dual labor market framework to argue that, that relationship, that is when the number of good jobs is declining, norms of stratification in which women are lower in the hierarchy are more likely to get excluded from those jobs. That is, men are likely to preserve the fewer good jobs that exist for themselves. That's what the data are consistent with.

The data are also consistent with the fact that as the capital intensity of production increases, women also are more likely to be excluded from those jobs, not because they don't have the skills, but I think because probably of gender norms as well as gender hierarchies, and that gender hierarchy answers this question. When good jobs are scarce, who is more deserving of that job? It is typically people that are higher up in the hierarchy and in this case, males.

SHARMINI PERIES: Right. In terms of wages, you argue that women's participation in the industrial sector lowers the overall wage of the workers in that sector. How does that actually take place?

S. SEGUINO: I think it's through a bargaining power process, right? When you do an aggregate analysis that Alyssa and I did, you can't really get down to the micro level, and you need a micro-level data set to help you figure that out. But I think what's going on is a bargain process that men are less able to bargain for higher wages because their fallback position is weaker, in the sense that there are fewer good jobs and that women are segregated into the low quality jobs and that gender nature of those jobs really for a variety of reasons depresses wages there. Men recognize that there's a huge cost to losing their job in the industrial sector. It therefore weakens them in terms of their willingness to bargain aggressively for higher wages.

SHARMINI PERIES: Stephanie, you have chosen to use an econometric model for your paper to show the correlation between various factors. Now, often, particularly when you do gender related research, you put in a lot of qualitative analysis into it, but you choose an econometric model and usually this is associated with mainstream neo-classical economics as they reduce complex social and political realities into numerical relations. Why did you choose this as the model?

S. SEGUINO: Most of my work has relied on quantitative analysis. I think it's important to move from anecdote to these kinds of analyses that will tell us about patterns in the data. But you can't really build these models without this kind of, this qualitative micro-level analysis. A lot of what Alyssa and I were theorizing around dual labor markets has been micro-level analysis and qualitative analysis. That informs the way that we construct these models.

I think that these quantitative models are important because they do tell you about patterns in the data. They're one piece of a variety of pieces of evidence that you need to make your case. I often think about this in the way that I think about legal cases in court. There's very rarely a single piece of evidence that a lawyer relies on to convince the jury. Usually it's a variety of pieces of data, and so this kind of econometric analysis is one piece of data. It happens to be consistent with the qualitative studies that we're hearing around job, the quality of jobs in developing countries in the process of globalization and it's consistent with stratification theory. I think that it's, as I said, it's one piece of a larger array of pieces of evidence. The question is does this piece of evidence line up with the conclusions of the other methodological approaches? Then if it does, you have a very strong case.

SHARMINI PERIES: Stephanie, in what way will these findings be incorporated into policy?

S. SEGUINO: That is a good question. We did this, Alyssa and I did this work and it is chapter 5 in the new UNCTAD Flagship Report, the Trade and Investment Report for 2017, and I think in that context because it will be widely distributed amongst UN organizations and hopefully widely read, that that will begin some discussions around policies that could be used to address the issues raised in the paper.

SHARMINI PERIES: All right Stephanie. I thank you so much for joining us and all the best with your paper.

S. SEGUINO: Thanks so much. Thank you.

SHARMINI PERIES: And thank you for joining us on The Real News Network.


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