COVID-19 Implications for women’s participation in the labour market in Latin America and the Caribbean

For decades, LATAM and CAC have been characterized as the most unequal region of the world, and it has been exacerbated by the results of the COVID-19 crisis that has affected virtually everyone in the world, with already vulnerable people becoming even more at risk, including women.

To introduce the topic of the inequality previous to the pandemic in the labor market, women had 54% of global jobs in accommodation and food service, which are among the sectors worst affected by the crisis, 43% of jobs in retail and wholesale trade, and 46% in other service, including the arts, recreation, and public administration. What’s more, 9 in 10 of those who work part time because of childcare and other family-related reasons are women. Part-time work is significantly more common in low-wage occupations, where women are the majority of the workforce and it is less common to have stable hours, and over 700 million women work in the informal economy, one of the worst problems LATAM is facing (and it is estimated that their income fell by 60% during the first month of the pandemic). In general, women’s employment is 19% more at risk compared to men’s, given that women used to have a disproportionate amount of unpaid jobs around Latin-America.

Now, the pandemic has reversed the progress the region has made in gender equality in these countries. As mentioned before, women have been more greatly affected by it, than men. 72% of domestic workers, 80% of whom are women, have lost their jobs as a result of the pandemic, 25% of self-employed women have lost their jobs, compared to the 21% of men. Women’s jobs are 1.8 times more vulnerable to this crisis than men’s jobs. Women make up 39% of global employment but account for 54% of overall job losses. Furthermore, women have been more affected given that they usually work the most vulnerable sectors, which makes their jobs 19% more vulnerable than those of men. (Madgavkar, White, Krishnan, Mahajan, Azcue, 2020)

However, after extensive analysis and research has found three main problems and given a solution to each of them. The three problems that will be further discussed are: the threat of automatization & digitalization, the burden of unpaid care, and the informal market.

Threat of automatization:

  • Technological innovation through machine learning, robotics and artificial intelligence is likely to automate many tasks and jobs, thus improving productivity, and freeing time. Technological innovation presents an opportunity to rethink the distribution of time spent on paid and unpaid work, tackle the inequality in the division of domestic and care work between women and men, and provide time for upskilling and lifelong learning needed to benefit from future opportunities.
  • Automation and intermediation technologies that include robots, information and communication technologies, AI, shared transport platforms, digital work platforms and property rental platforms have a direct effect in the labor market in the region. 62% (the country with the lowest level of impact) of jobs in the Dominican Republic and 75% in Guatemala, could disappear as a result of automation
  • The impact of long-term automation trends on world is estimated that, worldwide, 40 million to 160 million women, 7-24% of those currently employed, may need to transition across occupations by 2030 as automation transforms the nature of work (InterAmerican Development Bank, 2020).

Solution:

  • Reskilling and correct allocation of workforce has a positive impact in the percentage of job losses. For example, in the US, the change workforce concentration in new sectors of the industry, made the impact of automation on employment fall from 47% to just 9 (Madgavkar, White, Krishnan, Mahajan, Azcue, 2020).

Burden of unpaid care:

  • The burden of unpaid care also affects in which the demand for it has grown substantially during the pandemic. Women are on the front lines, as they do an average of 75% of the world’s total unpaid-care work, including childcare, caring for the elderly, cooking, and cleaning
  • Companies that are now pulling back in diversity and inclusion, may be placing themselves at a disadvantage in terms of resilience and the ability to recover from the current crisis; the could be limiting their access to talent, diverse skills, leadership styles and perspectives (Institute for Women’s Policy Research, 2021).
  • Women tend to spend more time on unpaid household and family care work, and men spend more time in paid work. This unequal distribution of times creates barriers to women’s advancement at work and reduces women’s economic security
  • Time poverty has also increased during the pandemic: it has intensified women’s unpaid care and domestic workloads
  • Men are much more likely to say they do not engage in these activities than women: only 6% of women say they have never engaged in cleaning and 44% of men report the same.

Solutions:

  • Family-friendly policies, including flexible programs and part-time programs, to support workers experiencing an increased childcare burden during the pandemic and beyond
  • A professionalized childcare industry, with public-financing support, in developing countries, where the social-services infrastructure is less well developed; this could not just enable many women to work but also create employment for others
  • From a labor-market standpoint, COVID-19 is accelerating remote-work and independent work platforms. This could be a boon for women, who can benefit from the flexibility that such platforms offer.
  • Guarantee paid family leave, paid sick days and paid vacation: investing in paid leave policies that address life cycle needs for time can potentially increase GDP by increasing labor force participation rates, particularly for women
  • Employer or state-funded provision of childcare or tax policies that encourage both spouses to work
  •  Paid maternity and paternity leave to eradicate the stigma towards mothers in the workforce

Informal Market:

  • Latin America is at the top of the informal markets, which makes it really difficult to manage the labor market.
  • Informality has grown in the past years in almost every LATAM country and has increased during the COVID-19 pandemic. Informality also creates the problem of nontaxpayers, that has been a huge institutional void in LATAM. Add regional government corruption on top of that.
  • This is a problem as the informal economy offers a limited stability and insurance for financial, social and health security (Madgavkar, White, Krishnan, Mahajan, Azcue, 2020)

Solutions: 

  • Regulate the informal market, some Latin American countries’ laws do have regulations for the informal sector but are not being enforced, Mexico for example
  • Gig workers must be considered formal workers. Must have social security and health and social benefits, implemented by the contract
  • Continue boosting women empowerment by creating institutions of international cooperation. Incentives and loans to be more accessible for women entrepreneurship.
  • Promote higher level positions to be filled by women.  This will tackle gender biases in recruitment and selection processes.
  • Improve access to quality part-time or reduced hours work: legislation to provide workers who work less than 35 hours with the right to equal treatment in pay, promotions and benefits, and to give employees options for reducing their hours without having to change employment or their career, can improve access to quality part-time work

Women’s gender equality in a post-pandemic labor market is essential, because in a gender regressive scenario in which no action is taken to counter these effects, McKinsey estimates that the global GDP growth could be $1 trillion lower in 2030 than it would be if women’s unemployment simply tracked that of men in each sector. Also, it has also established a strong link between gender equality in society and gender equality in work and shown that the latter is not achievable without the former (Madgavkar, White, Krishnan, Mahajan, Azcue, 2020). Governments and businesses must consider how to safeguard girls’ education, concentrated in reskilling, tackle labor market informality, and protect maternal health and women’s rights for paid work, to name a few important issues.

The author of this essay, Fernanda Ríos Herrera, winner of the recognition for “Best Delegate” of the UN Women committee, shows us the great inequality that occurs in Latin American countries due to the current crisis, for COVID-19 and some solutions that can help mitigate it.

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