“Time Poverty”, Gender Inequality and Exclusionary Economies: Time to Change Course

In recent Gate’s Foundation Letter, Ms. Gates points to the fact that women perform the majority of the unpaid household work, which leaves them with less or insufficient time i.e., time poverty, to do paid work that may invariably advance their careers. As a response to their own query which superpower they wished they had, Bill chose energy while Melinda selected time. But lack of time means one thing for a person living in a rich economy and an entirely different thing for a man or a woman living in a less developed country where lack of basic infrastructure serves as a hurdle to performing the most basic tasks.

Ms. Gates points to the Organization for Economic Cooperation and Development (OECD) data that states that, on average, women spend 4.5 hours of unpaid work a day vs. 2.25 hours for men. These numbers vary depending on a country’s development stage and social norms: in the U.S, for example, the numbers are similar to those of the OECD average – 4 hours for women vs. 2.5 hours for men. While in more egalitarian countries like Norway and Sweden, the ratio shrinks to 3.5 hours for women and closer to 3 hours for men. In countries like Japan, however, the ratio widens to a whopping 5:1.

Undoubtedly, Ms. Gates touches upon a very important issue with the aim of shedding light on gender inequality that has been so prevalent in spite of progress made. But this unequal division of labor, if you will, has far reaching implications beyond that of gender inequality. Labor economic models have notoriously neglected to account for unpaid work focusing instead on the tradeoff between labor and leisure. The labor-leisure model isolates the person’s wage rate and income as the key economic variables that guide his/hers allocation of time between the income generating and leisure activities. Furthermore, traditional labor supply and demand models thoroughly ignore the “time poverty” element that accounts for some of the wage differentials between genders. These models define the equilibrium wage as merely a function of labor supply and demand in the marketplace, neglecting hosts of other variables such as household work and non-linear budget constraints.  A Monopsonist labor economic models, however, account for these variations in labor supply elasticity between genders and the resulting wage differentials. This burden of domestic [unpaid] work directly affects women’s labor participation rate and invariably leads to lower earnings.

GDP, the most prevalent measure of economic growth, fails to take into account unpaid labor, which leaves women’s contribution unaccounted for and contributes to greater gender and economic inequality (not to mentions excludes economic activity.) According to a report from the Center for American Progress (CAP):

Nearly all of the rise in U.S. family income between 1970 and 2013 was due to women’s increased earnings, and according to the Council of Economic Advisers, if women’s labor force participation had not increased since 1970, “median family income would be about $13,000 less than what it is today.”

Nowhere is the evidence that the burden of unpaid labor and care work in the U.S. falls primarily on the shoulders of women more striking than the fact that between 1990 and 2010 U.S. female labor force participation fell from 6th to 17th among 22 OECD countries. Major contributors to this trend is lack of family-friendly work policies that place the burden on women, as well as lack of paid maternal leave.

Ms. Gates “borrows” her solution from Professor Diane Elson who suggests that in order to tackle the problem we need to Recognize, Reduce and Redistribute the work. As an economist, I wholeheartedly agree that recognition the way professor Elson articulates it, which “involves gathering quantitative and qualitative information on the scope of unpaid work and the distribution of its burden among individuals, communities and other institutions” is crucial to tackling the problem. Using economic models that include measures of unpaid work with the ensuing wage differentials, is detrimental for policy prescription. Also, cultivating and nurturing a culture that promotes greater equality in household chores and in overall care labor as has been advocated by Anne Marie Slaughter in her book, Unfinished Business: Women, Men, Work, Family, has the potential to push us in that direction.

THESE ARE NOT WOMEN’S ISSUES. THESE ARE ECONOMIC ISSUES.

The implication of this unfair burden of care and household work on women with its resulting stalling or falling labor participation rate (as is the case in the U.S) for the overall economy cannot be overestimated.  When women do the majority of the unpaid work, they have less opportunity to pursue further education which might prevent them from advancing their careers. Also, uneducated women often have less educated and often unhealthy kids, another grave repercussion. The latter is particularly true in developing countries. Lastly, women have the potential to “move the dial” and lift a country’s economy to the next stage of development and failing to afford them the opportunity to do so, excludes a major driver for economic growth.

Now that gender equality has come to the forefront of the development agenda and is included in the Sustainable Development Goals, particularly the target to “Recognize and value unpaid care and domestic work through the provision of public services, infrastructure and social protection policies and the promotion of shared responsibility within the household and the family as nationally appropriate“ –  let us make sure we shape strategies, use suitable economic models and craft the appropriate policies to make that happen.

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Categories: Poverty and Inequality, Women at Work

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