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Home > Investments > Economic Indicators

By Diane Perrons and Ania Plomien | Published Mar 27, 2014

Managing the gender divide

Typically, the economy is defined by markets and incorporates goods and services produced and exchanged for money, measured by GDP. Goods and services produced by unpaid work – predominantly by women within the household – are not included in national accounting systems and yet undeniably contribute to overall well-being. Adopting a broader view of the economy, incorporating paid and unpaid work, produces a more accurate assessment of the range of economic activities, provides a fuller account of the economic contributions of women and men, and establishes the foundations for gender equality.

Contribution

Over the last 50 years, women’s contribution to paid employment has increased while men’s has declined. Women have cracked the glass ceiling by occupying positions of power and responsibility in the public and private spheres, workplaces are less segregated, and men have become more involved in childcare. The Economist even claimed that a “quiet revolution” has taken place as women are gradually “taking over the workplace”. However, a more careful analysis suggests this claim is premature and three key challenges remain: employment segregation, the gender pay gap and the gender division of labour between paid and unpaid work.

Nearly all workplaces are more gender-balanced than 50 years ago, but progress towards equality has been slow and uneven. Women represent 20 per cent of FTSE 100 board directors but only four are chief executives. Women are under-represented among the top 10 per cent of earners and vastly over-represented among the low-paid. This situation is not improving as there are now three times more young women in low-paid jobs than 20 years ago. Women’s low pay is linked to their concentration in the three Cs – caring (82 per cent female), clerking (77 per cent female) and cashiering (63 per cent female); while men are more likely to be managers and senior officials (77 per cent male), process, plant and machine operatives (89 per cent male) and in ‘skilled’ trades (90 per cent male).

Yet this does not explain why women are valued differently. Feminist economists have challenged conventional economic theory linking pay to marginal productivity, pointing out that productivity is not an appropriate measure for labour-intensive relational work, such as care work, where the input is also the output and productivity increases are limited unless the character of the work is profoundly changed. Parallels are drawn with William Baumol’s notion of technologically unprogressive sectors epitomised by the problem of increasing the productivity of a string quartet. Even the Coalition Government turned back from increasing the number of toddlers for each care worker to six; and private sector providers struggle to make profit except by paying low wages and exacerbating labour market disadvantage among women, migrants and ethnic minorities. The fact that care work is so low paid is even more surprising given the value people place on their children and parents, and expenditure on care generates social benefits in the form of better educated citizens with social skills of communication and trust.

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