Women and Austerity

The Economic Crisis and the Future for Gender Equality

Maria Karamessini, Jill Rubery, Maria Karamessini, Jill Rubery

• Publisher: Routledge
• Year: 2013
• eBook ISBN: 9781135073978
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

Austerity has become the new principle for public policy in Europe and the US as the financial crisis of 2008 has been converted into a public debt crisis. However, current austerity measures risk losing past progress towards gender equality by undermining important employment and social welfare protections and putting gender equality policy onto the back burner. This volume constitutes the first attempt to identify how the economic crisis and the subsequent austerity policies are affecting women in Europe and the US, tracing the consequences for gender equality in employment and welfare systems in nine case studies from countries facing the most severe adjustment problems.

The contributions adopt a common framework to analyse women in recession, which takes into account changes in women's position and current austerity conditions. The findings demonstrate that in the immediate aftermath of the financial crisis, employment gaps between women and men declined — but due only to a deterioration in men's employment position rather than any improvements for women. Tables are set to be turned by the austerity policies which are already having a more negative impact on demand for female labour and on access to services which support working mothers. Women are nevertheless reinforcing their commitment to paid work, even at this time of increasing demands on their unpaid domestic labour.

Future prospects are bleak. Current policy is reinforcing the same failed mechanisms that caused the crisis in the first place and is stalling or even reversing the long term growth in social investment in support for care. This book makes the case for gender equality to be placed at the centre of any progressive plan for a route out of the crisis.

PART I

Developing the analytical framework

1

INTRODUCTION – WOMEN'S VULNERABILITY TO RECESSION AND AUSTERITY

A different crisis, a different context

Maria Karamessini

Main aims and structure of the book

This edited volume on Women and Austerity has three main aims. The first is to identify the impact of the current global financial and economic crisis and the subsequent sovereign debt crisis on women relative to men, particularly its effects on gender equality in the employment and welfare systems of advanced economies. The second is to improve our understanding of women's vulnerability to recession and the policy responses to it in the light of their increased integration into employment and the evolution of gender regimes and contracts since the last major recession in the US and Europe. Both of these strands are developed to provide a framework for considering the challenges that the current structural economic crisis poses for further advancement towards gender equality in advanced societies. Identifying and discussing these challenges is the third and final aim of the book.

Our inquiry is limited to North America and Europe. A distinctive aspect of the current crisis in this part of the globe, compared to previous recessions since 1973, is its significant effect on services, in which the greatest share of female employment is concentrated. This effect is associated with the intensity and duration of the current crisis but also with austerity policies which have been and/or are being implemented to counter the impact of the crisis on public finances. In the US, employment in services contracted by 2.2 per cent between 2008 and 2010. Contraction has been much greater in the European countries hardest hit by the crisis, such as the Baltic States, Iceland, Ireland, Greece and Spain. Austerity policies, especially in the countries that have been or are being implementing fiscal consolidation packages and plans, have largely contributed to this outcome through their direct impact on public sector employment and their recessionary effect. These policies are also responsible for public sector pay freezes and reductions, cuts in social expenditure and welfare state reforms that have different implications for women and men. Given that the public sector and social transfers and services have been key for women's economic integration and access to protected employment and good quality jobs from the Second World War onwards, austerity represents a major challenge for gender equality.

Five years after it officially began in the US, the current crisis – widely referred to as ‘the Great Recession’ – is not yet over since its structural causes have not been tackled. Until now, the advanced core of the world economy has been most affected. Although significant state intervention in the initial phase avoided collapse of the financial system and recessionary spirals, recovery in 2010 and 2011 was weak in most advanced economies while it was very strong in many emerging and developing ones.

Recovery in the advanced economies has further weakened in 2012, mainly due to a sharp slowdown of the Euro area, which is experiencing a politically induced second recessionary dip. EU institutions have opted for fiscal consolidation to address sovereign debt crises in the periphery of the Eurozone and curb the continuing rise in sovereign debts elsewhere. They promote a coordinated implementation of austerity policies and structural reforms in labour and product markets and the welfare state by all EU Member States. There is now considerable internal pressure also on the US federal government to engage in a decisive reduction of the public deficit, as illustrated by the political negotiations over fiscal adjustment between President Obama and the Republicans after the November 2012 elections. Austerity is expected to have negative effects not only on demand for female labour but also on access to services that support women as carers, thereby often compelling them to substitute for cutbacks through increasing unpaid domestic labour. The policies in the EU are commonly being enacted without reference to the notion of gender mainstreaming, despite commitments to this principle by the EU from 1995 onwards. This book discusses the gender dimensions of policy responses to the crisis during all its phases. It places, however, particular emphasis on the austerity and fiscal consolidation policies taken to include both immediate or short-term demand restricting measures and longer-term structural and institutional reforms under employment, income and social policies.

To interpret the longer-term impact of these policies on gender equality we also need to explore the second and related main aim of the book, that is to develop an updated framework for understanding women's vulnerability to recession and austerity drawing on Jill Rubery's classic edited volume Women and Recession, published in 1988 and republished in 2010 as a Routledge classic. This volume contributed not only to the understanding of long- versus short-term trends in women's employment, by analysing the different roles of gender segregation in the labour market and the different degrees of women's integration into wage work in the US, France, Italy and the UK but also related women's employment to different configurations of the state and family in these four OECD countries. This latter approach provided a comparative analysis of employment in relation to welfare states before the explosion of work on comparative welfare systems in the 1990s and beyond.

The above framework provides the starting point for this collection but it is updated in three important respects: firstly in relation to the nature of the crisis and the context in which austerity policies are being enacted; secondly in relation to the impact that twenty years of further integration of women into wage employment may have had on the gender contract and on associated responses to recession and changes in labour demand; thirdly in relation to the potential for the current austerity programmes to constitute a turning point, particularly in European social models, which could roll back the increasing support for working families across Europe in the past decades, even in countries where this support was clearly inadequate before the crisis. The framework developed in 1988 took as an underlying hypothesis that there was likely to be a longer-term upward trend in women's employment integration supported by a developing welfare state, even if these tendencies might be suppressed in periods of recession or by interludes of economic and political policies aimed at cutting back the welfare state. The current context raises the possibility of long-term retrenchment even in welfare systems that are still underdeveloped and may also reveal potential for a general trend away from gender equality rather than simply delayed progress.

To consider these issues this book brings together a wealth of expertise on gender, employment and welfare state systems. The first part provides two conceptual papers, one by Rubery on the framework for analyzing women in austerity, and another by O'Reilly and Nazio on the changing gender contract. The second part includes a comparative paper on developments in women's labour market position in Europe during the crisis (Bettio and Verashchagina) and nine country case studies. The selected cases include the US (Albelda) that was at the origin of the crisis, two countries that were at the heart of the initial financial crisis (Iceland (Thorsdottir) and the UK (Rafferty and Rubery)) and one strongly affected by it (Hungary (Frey)) and the five countries that triggered and foment the ongoing Eurozone crisis (Greece (Karamessini), Ireland (Barry and Conroy), Portugal (Ferreira), Spain (Gago and Segales Kirzner) and Italy (Verashchagina and Capparruchi)). The third part of the volume consists of two chapters dealing with policy issues and a concluding chapter. Villa and Smith deal with developments in the gender equality goal within the EU employment policy during the crisis and the chapter by Perrons and Plomien is on why the goal of gender equality needs to be integrated in alternative projects for developing more inclusive and equitable routes out of the crisis. The concluding chapter (Karamessini and Rubery) then draws together the key arguments and evidence developed in the book to consider the future prospects for gender equality.

Women's position pre-crisis

Apart from the 1988 edited volume by Rubery¹ on how in the US, UK, France and Italy the economic structure, labour market institutions, family organization and the welfare state jointly shaped the experience of women during recessions in the 1970s and 1980s, most of the English language literature on advanced countries has in practice only dealt with the experience of US women, focusing particularly on the impact of business cycles and crises on the variation of the gender gap in the unemployment rate (Milkman 1976; Lynch and Hyclak 1984; Seeborg and DeBoer 1987; Miller 1990; Goodman et al. 1993). However, in the 1990s and 2000s, an important literature emerged on the impact of economic crises on women's labour market outcomes, fertility and well-being in many newly industrialized and developing countries (see review by Sabarwal et al. 2010). Moreover, feminist economists have strongly criticized the social costs, gender dimensions and macroeconomics of IMF economic stabilization and structural adjustment programmes imposed on these countries, which have been accused of gender blindness and male bias (Elson 1995; 2002; Beneria 1999).

In practice, many of the central issues to emerge from the literature on emerging and developing economies are common to those identified as salient for advanced economies. These are also the central issues covered in this book, namely employment segregation by sex and its influence on job losses, added/discouraged worker effects, and the impact of the crisis on social infrastructure and services, social reproduction and women's unpaid work. There are though three important sets of differences between the two groups of countries that call for different research questions. Firstly, in advanced economies women are predominantly concentrated in services not in manufacturing or agriculture and their integration in formal paid employment is much higher, with the share engaged in the underground economy and informal work much lower. Secondly, the welfare state and safety nets are much more developed, while being residual or non existent outside the advanced countries. Thirdly, in the latter, compared to other parts of the globe, the challenges to traditional gender roles, family models and the gendered division of labour posed by feminist movements, women's changing aspirations and public policies have been much stronger.

However, the pre-crisis gender regimes of advanced economies also varied greatly and these differences in the gendered pattern of paid and unpaid work could be attributed to variation along similar dimensions. Over recent decades all these economies have tended to experience an apparently irreversible integration of women into paid work, more continuous female activity patterns and a decisive shift away from the male-breadwinner family model towards a dual earner/adult worker model. However, national variation in the historical pattern of women's integration in paid employment and construction of the welfare state and in gender contracts have still generated significant country differences as well as intra gender variations in women's labour market integration, including participation, location in the employment structure, relative pay and social rights. This variation also applied to the spread and configuration of the gender specialized dual earner/adult worker family model (Lewis 2001; Lewis et al. 2008; Daly 2011).

Table 1.1. shows that, in 2007, among our nine countries, women's integration in paid employment ranged from very high (Iceland) to very low (Italy, Greece, Hungary) while the incidence of temporary employment among women ranged from very extensive (Spain and Portugal) to unimportant (US, UK, Hungary). The female part time rate was very low in Hungary, Portugal and Greece but very high

TABLE 1.1 Women's integration in paid work and family models in selected European countries and the US 2007

%
	Employment rate (15–64 years)	Temporary employment rate*	Part time employment rate*	Dual earner couples**
Greece	47.9	13.1	13.7	55.7
Hungary	50.9	6.8	4.2	64.7
Iceland	81.7	13.6	24.8	90.2
Ireland	60.7	9.5	34.9	62.2
Italy	46.6	15.9	31.2	58.7
Portugal	61.9	23.0	8.7	70.1
Spain	55.5	33.1	20.8	61.9
UK	66.3	6.4	37.2	76.7
USA	65.9	4.2 (2005)	17.9	66.2
EU-21 average	58.5		28.7
OECD average	57.2	12.9	23.8

* Percentage of dependent employment. ** Proportion of all couples with at least one partner working; only for the USA, proportion of all married couples with at least one spouse working.

Source: First column: Eurostat, European Labour Force Survey (online database); second and third columns: OECD. Stat (data extracted on 21 Oct 2012); fourth column: calculated from Bettio and Verashchagina (this volume), Table. 4.2, and US Department of Labor, Bureau of...

Table of contents

• Cover
• Half Title
• Routledge IAFFE Advances in Feminist Economics
• Title Page
• Copyright Page
• Table of Contents
• List of figures
• List of tables and boxes
• Acknowledgements
• Contributors
• Part I Developing the analytical framework
• Part II Recession and austerity: experiences in the EU and selected country cases
• Part III The policy challenges and the prospects for gender equality
• Index