International Journal of Politics, Culture and Society, Vol 15, No. 1, September 2001 (©2001) II. Employment Risks Shifting the Risk: New Employment Patterns, Informalization, and Women's Work1 Lourdes Beneria2 The paper argues that the processes of informalization of jobs observed during the past decades have affected both high and low income countries. Starting at the micro level of the firm, the emphasis is on how economic restructuring and globalization have generated the growth of informal activities—resulting in the vicious circle of poverty and economic insecurity for an important proportion of the population. The second part of the paper analyzes the growth of women's participation in informal activities, emphasizing that there are contradictory forces at work regarding women's employment Despite a stubborn persistence of gender discrimination and obstacles to women's advancement, progress has taken place on several fronts, such as in the education field and in the absorption of female labor in many production processes. The paper concludes by pointing out that poverty eradication programs must emphasize the need to generate decent jobs without which these programs will continue to be ineffective. In addition, re-distributive mechanisms and different forms of social protection are needed to counteract the forces and policies generating economic insecurity. KEY WORDS: informalization; precarious jobs; informal sector; economic restructuring; globalization; women's employment; feminization of the labor force; home-based work; commodity chains. Many still question claims that the patterns of working life are changing. But in the United Sates the anecdotal signs are increasing: more frequent job changes, more freelancing, more working at home, more opportunity but also more uncertainty. The old social contract between employers and workers is being shredded. It is still unclear what will replace it. (The Economist, 1/29/2000) ll want to thank Juan Arbona and Gale Summerfield for their comments on an earlier version of this paper. 2Professor of City and Regional Planning and Women's Studies, Director, Program on Gender and Global Change, 209 West Sibley Hall, Cornell University, Ithaca, NY 14853; e-mail: lb21@cornell.edu. 27 © 2001 Human Sciences Press, Inc. 28 Benería INTRODUCTION During the 1970s and early 1980s, relocation of production from high to low income countries gave rise to a large body of literature focusing on the threats of de-industrialization in high income countries (Fröebel et al., 1980; Bluestone and Harrison 1982). Although since then many industrial processes have indeed been shifted to lower income countries, the fears expressed in some of these studies did not materialize; the enormous growth of the service sector, including the financial sector, and the development of high tech industries have maintained the predominance of high income countries in the world economy. However, this has not prevented the appearance of deteriorating working conditions for specific working populations even when prosperous trends have predominated. In both high and low income countries, labor market deregulation and increasing flexibilization of the work process generated new challenges, particularly as market competition induced a search for lower production costs (Piore and Sabel, 1984; Harrison and Bluestone, 1988). In addition, other factors such as trade liberalization schemes have reinforced the competitive pressures of global markets. Taken together, these developments have resulted in profound processes of reorganization of production, technological innovation and changes in the structures of firms and in employment conditions. Since the 1980s, there has also been a growing body of literature focusing on the ways economic restructuring has made possible further decentralization of production, both geographically and within firms (Dicken, 1998). Institutional changes at the micro level have been deep—from downsizing and outsourcing to changes in work organization, skill requirements, and transformations in the composition of the workforce. Trade liberalization has had significant effects on changing skill requirements and on the dynamics of employment and relative wages within and across countries, particularly in terms of shifting labor intensive processes of production to low wage countries (Wood, 1994). Needless to say, many of these transformations are gendered, with differential impacts on men and women that are influenced by a variety of factors. At the same time, we have witnessed the continuing process of feminization of the labor force at the domestic and international level—with the concept of feminization being used to refer both to an increase in women's labor force participation and to the deterioration of working conditions in previously male jobs (Anker, 1998; Standing, 1999). These changes have profoundly affected productive processes, transforming firms' functions and modes of operation as well as their employment patterns and capital/labor relations. As a result, labor market structures have been de-stabilized and reorganized. Most importantly, the changing landscape of production at the micro level has led to deep changes in job New Employment Patteras, Informalization, and Women's Work 29 creation and the generation of new forms of employment. For this reason, it is important to understand the changes at the micro level of the firm and how they affect the labor market. The old social contract between employers and workers is indeed being shredded. The Organization Man of the post-WW II period, based on stable employment and loyal dependency on the firm, is being replaced by a much less stable workforce, with profound consequences for lifetime work experiences and attachment to a specific firm (Capelli, 1999; TE, 3/27/00) and with important distributive consequences. Speaking from a business perspective, Capelli even claims, "the old employment system of secure, lifetime jobs with predictable advancement and stable pay is dead" (p. 17). The result has been declining employment and other types of security and an increase in the risks that employees and labor in general must bear. At the same time, a decline in labor union membership has taken place in many countries, contributing to the relative loss of power among labor and rising income inequality (Katz, 2000). This paper focuses on the effects of economic restructuring on employment dynamics and on the nature of jobs and their characteristics. What are the main trends? Can we generalize across countries? What are the implications of the increasing informalization of employment and jobs? What emerging trends in informal activities do we observe both in high and low income countries? What are the gender dimensions of these processes? The paper first summarizes the changes taking place at the micro level of the firm in order to contextualize their repercussions on employment dynamics and informalization processes; the paper's main focus is on the expansion of contingent and informal activities, particularly with respect to women in developing countries. THE MICRO FOUNDATIONS Since the 1980s, market penetration into the internal dynamics of firms has become increasingly common, often dismantling former internal labor market structures, with a growing direct influence of the market on the ways in which business is conducted. External labor market conditions have increasingly had a direct influence on capital labor contracts, working conditions, the organization of production, employee training, and wage structures. At the same time, the internal structure of the firm and the new forms of capital/labor relations in turn have had repercussions on the dynamics of the external labor market. The following trends summarize the major changes along these lines: First, there has been a shift of 'employment from "core" to "periphery" activities located in smaller firms and independent contractors (Harrison, 1994; 30 Benería Hsiung, 1996; Ybarra, 2000). This has resulted in the reduction in the size of large firms, with downsizing being parallel to outsourcing and subcontracting. In the United States, the drive towards leaner production and shrinking workforce became particularly prevalent during the 1980s and 1990s, affecting not only low skill workers but reaching management ranks as well. The trend has been accompanied by the continuous pressures resulting from global competition towards lowering production costs. As Capelli (1999) has pointed out, downsizing refers to the dismissal of workers for reasons that are not related to their performance. These reasons have to do with the pressures on firms to "perform" and compete at the global level. Strategically, globalization has facilitated the reduction of core firm size by paving the way for the geographic expansion of the "periphery" to new outsourcing sites in other countries (Dicken, 1998). Second, resulting from the previous trend, there has been a reduction in hierarchical levels within core firms themselves, resulting from several tendencies: a) the dismantling of internal labor markets based on merit, seniority and other promotional factors; b) the elimination of middle management and the formation of "worker teams" and different forms of job rotation; c) the concentration of high skill jobs in core firms and the shifting of low skill activities to locations outside the core (Harrison, 1994; Batt, 1996; Osterman, 1996; Cappelli, 1999). Highly skilled, educated professionals tend to concentrate in increasingly technologically based jobs at the core, including management, research, and specialized work such as that provided by financial and legal experts. At the same time, these professionals are benefiting from an expanded market at the global level and from the opportunities provided by what has been referred to as a "global driver's license" or the high degree of employ ability enjoyed by professional and technical labor across countries. However, at least in the United States, the most pronounced divide has evolved between top executives and other employees due to the power concentrated at the top levels and to their highly remunerative compensation schemes, which have been well documented during the past two decades (Capelli, 1999). Third, except for the core of more privileged labor, the changing employment contract shows a clear tendency towards unstable employment. At the bottom of the income scale affecting low skill labor, the fastest growing part of the labor force in many areas is to be found in informalized work or temporary and part-time employment. This includes the increasing reliance of firms on contingent work and decentralized production systems (Leigh, 1995; Recio, 2000). In the US, for example, the distribution of employment is such that regular, full-time employees represent about 68.8% of the total (Upjohn Institute, 1997); it has been estimated that the fastest growing part of the economy in the state of California is the temp business.1 In the euro New Employment Patterns, Informalization, and Women's Work 31 area, a recent study by Morgan Stanley Dean Witter found that most of the net jobs created between 1994 and 1998 were either part-time or temporary (TE, 6/10/00). Although the ways this informalization process takes place varies considerably by country and region, it occurs in both high and low income countries and it is part of the increasing economic insecurity registered even in countries experiencing sustained economic growth, such as the United States during the past decade. In developing countries, this trend has contributed to the high growth of the informal sector (see below). Fourth, the processes of informalization and decentralization affecting current labor market trends have produced a sharp increase in employment instability and the number of workers experiencing the stressful consequences of unemployment. Job and labor market insecurity has a pronounced effect on workers at the lower end of educational and labor market hierarchies (Leigh, 1995; Capelli, 1999; Katz, 2000). However, an important feature of current insecurity is that it is felt throughout the wide range of the occupational spectrum (Standing, 1999; ILO, 1999). In the United States, job tenure for men aged 35 and over has decreased since 1983, and the average 32-year old has already worked for nine different firms.2 For the working population, the chronically high unemployment rates registered in many countries represent a constant threat of losing access to income. This threat is felt in countries with relatively high unemployment rates, such as many European countries, but also in those with relatively low unemployment, such as the United States, where the threat of dismissal has been on the increase; despite almost a decade of uninterrupted economic growth in the US, layoffs during the past two years were increasingly widespread, and there is evidence that persistent worker insecurity is intensified by capital mobility (Bronfenbrenner, 2000). However, the problem is particularly acute in developing countries with chronically high rates of unemployment and underemployment. Standing (1999) has estimated that the "effects of GDP growth on employment (and unemployment) suggest that to make a substantial difference there would have to be a long and sustainable period of high rates of economic growth" (p. 153). Instead, many developing countries have registered low or fragile economic growth. Fifth, these tendencies have resulted in growing income polarization in most countries, resulting, on the one hand, in increasing job opportunities for skilled labor and, on the other, in a parallel reduction of opportunities for low skilled workers. In 1979, the average college graduate in the United Sates earned 38% more that the average high school graduate; the current gap is 71% (TE, 1/29/00). In high income countries, the outsourcing of production to low wage areas, particularly in labor intensive industries, has led to a gradual deterioration of the earnings for the those displaced (Wood, 1994). Studies show that when displaced workers find new jobs, the large majority 32 Benería tends to move to more precarious and lower paid positions (Benería and Santiago, 2001; Tiffany, in progress). Likewise, trade liberalization has been shown to have a negative effect on unskilled workers (Wood, 1994 and 1995; Rodrik, 1997). The dismantling of wage structures associated with the firm's internal labor markets produces pay structures closely linked to the changing labor market; rapidly shifting technologies tend to remunerate young new hires rather than experienced workers, producing inequities that have negative repercussions on the morale of older workers (Capelli, 1999). Statistics on income distribution are unambiguous on these growing inequalities, leading to pessimistic views about the effects of globalization, technological change and "the new economy" (UNDP, 1999). For the 1980s and 1990s, this has been the case for OECD countries as well as for developing countries and Eastern Europe, threatening to undermine the progress made through democratization processes. In Latin America, despite the recovery of many economies during the 1990s, the concentration of income has remained the same or worse, with the continuous huge gap between the top and bottom 20% in the income scale, and with variations across countries during the 1980s and 1990s (UNDP, 1999). Sixth, workers attitudes toward firms and the culture of work are changing. The "happy worker" model of the past, with stable employment and strong loyalty to the firm, is becoming less relevant for a large proportion of the working population. In turn, more unstable work contracts have had a negative influence on workers' commitment to the employer, abseiiteeism and discipline. Survey data show that labor turnover rates have increased significantly, and that highly skilled professionals are the least committed to their employers because they are aware of their better chances to find jobs elsewhere (Capelli, 1999). Younger and older workers often seem to differ in their commitment to the firm's objectives, as well as desired working conditions such as the length of the working day and other factors affecting the organization of work.3 Finally, although these tendencies have been registered in both high and low income countries, we observe conflicting forces at work. A firm such as General Motors is offering lifetime employment at the same time that it envisions downsizing, and many firms are firing and hiring at the same time (NYT, 9/12/99; WSJ, 3/13/00; Ozler, 2001). Some countries in the European Union suffer from labor shortages for specific segments of low skill labor despite a high overall unemployment rate; a few of them also experience labor shortages at higher occupational levels.4 The diminishing importance of internal labor markets has brought many advantages to some firms, such as the ability to respond quickly to market changes, lower long-term liabilities, flexibility in production, and reduced costs, at least in the short run. However, it has also created problems for capital, particularly New Employment Patterns, Informalization, and Women's Work 33 the inability to retain the best workers when the market is tight.5 Finally, while many authors praise the possibilities offered by the "high road" to development—i.e., high productivity and high wages—short term strategic objectives on the part of private sector firms and "market failures" often lead to the "low road" that fails the test of human development objectives (Appelbaum and Batt, 1994; Beneria and Santiago, 2001). THE INFORMAL SECTOR AND THE VICIOUS CIRCLE OF POVERTY IN DEVELOPING COUNTRIES The experience of the Asian tigers before the 1997 financial crisis had encouraged the belief that a model based on economic growth, increasing labor productivity, and relatively low wages could eventually generate a gradual improvement in income levels and living standards which would eliminate the poverty associated with informal activities. This would occur despite the fact that export-led industrialization was based on significant inequalities, particularly in the gender division of labor and wage gender gaps (Seguino, 2000). However, other regions such as Latin America and particularly Africa did not register the important leap that was associated with the Asian tigers before the 1997 crisis. Even areas that have been very successful in attracting foreign investment and generating increasing employment, such as the US-Mexico border region during the past two decades, have not seen living standards significantly improved for a large proportion of the population; in particular, women's working conditions have improved little, if at all (Fussell, 2000). Countries implementing structural adjustment packages have had difficulties dealing with persistent poverty and the labor market effects of austerity. This is in sharp contrast with the pre-crisis period in South East Asia and conflicts with early optimistic views concerning the positive effects of export-processing industrialization on wages and living standards (Lim, 1983). Market deregulation and the developments at the firm level described above have reinforced these tendencies, leaving large sectors of the population on the periphery of core activities where informal activities predominate. Hence the re-emergence of an interest in the informal sector among researchers and policy makers. During the 1970s and 1980s, the informal sector was viewed in developing circles as a transitory form of employment whose significance would decrease as the formal sector grew with employment and absorbed the marginal working population. In this sense, the sector was viewed as "backward" and problematic: The formal sector was the "modern" solution to the low productivity and poor working conditions prevalent at the informal level (ILO, 1972; SSP/UCECA, 1976). These initial formulations emphasized the 34 Benería sector's connections with the marginality of the urban poor as well as their unstable working conditions and their precarious location within the economy. The SSP/UCECA study defined it in reference to the following factors: • very low level of earnings, • absence of, or precarious, job contracts ® unstable working conditions • poor access to social services and absence of fringe benefits • very low rates of affiliation to labor organizations • illegal or quasi-legal work Conceptually, and despite many critiques to the contrary, the two sectors were viewed as separate and independent of each other despite studies documenting their linkages and pointing out the shortcomings of dualistic divisions (Bromley and Gerry, 1979). For example, analyses of subcontracting processes showed the extent to which the two sectors were highly interconnected, particularly but not solely in the industrial sector, through subcontracting and other links. They pointed out that, far from absorbing informal activities, the formal/modern sector often relied and fed on the former as a way to increase its competitiveness and profits (Benería and Roldán, 1987). In this sense, they were not separate or independent of each other but highly linked and instrumental for the formal sector. The implication was that the conceptual separation between the two sectors was in many ways artificial, even if useful to discuss different forms of employment. If anything, the last two decades saw these tendencies intensified, in terms of an increasing reliance of firms and households on precarious forms of employment. To be sure, we need to distinguish between two types of informalized activities: a) those linked directly or indirectly to industrial and service work in more formal settings, and b) those representing survival activities organized at the household level. The former is linked to profit-oriented operations and can include self-employment and wage work tied directly or indirectly to more formal production processes; this sector includes micro-enterprises and subcontracting arrangements, both in high and low income countries. The analysis in this paper refers mostly to this type of informal work. Survival activities on the other hand tend to represent precarious forms of self-employment with weak or no links to the more formal processes and without possibilities for capital accumulation, such as in the case of street vendors. Another type of differentiation results from the legal/illegal divide. The informalization of labor processes that we have observed in high income countries during the past two decades has mostly taken place within the context of legality, despite exceptions located in the underground economy. New Employment Patteras, Informalization, and Women's Work 35 _____________Table 1. Trends in Informal Sector Employment, 1980-1999_____________ In formal sector as % of non-agricultural employment % of women % of self- ---------------------------------- in the informal employment in the Regions 1980-1989 1990-1999 sector informal sector North Africa 38.8 43.4 — 51.5 Sub-Saharan Africa 68.1 74.8 52.3 90.0 Latin America 52.3 56.9 45.9 50.4 Asia___________________53£________63.0 39.9 __________63.0 Source: Charmes, 2000 (estimates based on national sources). This is much less the case in developing countries where, despite its growing importance, the informal sector tends to lack legal status and work takes place under the usual precarious conditions that have traditionally been associated with this sector. As Hernando de Soto (2000) has recently argued, these are the activities that are "filling the vacuum left by the legal economy" (p. 49). Contrary to initial expectations, the proportion of the population engaged in them has not decreased. Table 1 shows, that, between 1980 and 1990 the relative weight of informal sector employment increased significantly in all regions. Charmes' estimates, reported in this table, reflect the growing importance of this sector for non-agricultural employment. These estimates seem very high, probably resulting from the definition of the sector adopted by the 15th International Conference of Labor Statisticians in 1993, which included all non-agricultural "unincorporated enterprises owned by households." This includes micro-enterprises as well as professional, domestic workers, and home-based workers; it also includes family labor and "employees on an occasional basis." Far from being absorbed by the formal sector then, informal activities have been on the increase. In Latin America for example, where labor markets have been deeply transformed since the 1980s, most observers agree in the diminishing centrality of formal employment. As Pérez-Sainz (2000) has pointed out, there are a variety of reasons for the diminishing relative importance of formal employment in the region, from the effects of structural adjustment and market deregulation to the weakening of public employment due to budget cuts and privatization programs. Thus, although Latin America traditionally had high levels of informal employment, the past two decades have registered its further growth; in urban areas, it represented 47.9% of total urban employment in 1998, up from 44.4% in 1990 (ILO, 1999). These tendencies have led to the growing reliance on precarious forms of survival across countries, particularly for the poorest households but also affecting other sectors (Gonzalez de la Rocha, 2000; Oliveira, 2000). Household survival strategies include very unstable links with the labor 36 Benería market, combining, often within short time periods, wage labor and self-employment as well as temporary migration (domestic and international). This instability has led a Bolivian sociologist to talk about the phenomenon of "nomad labor," referring to survival strategies based on moving from one job to another (Garcia-Linera, 1999). In international development circles, the literature has used the notion of "labor exclusion" to refer to the vicious circle of poverty resulting from persistent levels of unemployment and marginality from regular sources of income. For example, weighted averages for Latin America show a 9% rate of open urban unemployment for 1999, "a figure above the 8.3% for 1985, at the height of the debt crisis" (Pérez-Sáinz, 2000) .6 These rates have persisted in the region despite economic recovery in many countries in recent years. Marginality and precarious jobs have become an integral part of the labor market experience of a large proportion of workers in the periphery, leading to questions about the "erosion of work" and the disappearance of traditional forms of wage labor (McMichael, 1999). As a study of current production processes in the outskirts of Cochabamba, Bolivia, has recently shown, some of the participants in precarious forms of employment are not even viewed as "workers" (Kruse, 2000).7 What are the differences between these current processes of infor-malization and the earlier stages in which the informal sector became a subject of study in developing countries? How can we compare current conditions with the 1970s in this respect? At least five observations can be made: First, since the 1980s, the macroeconomic context has changed considerably, due to the introduction of neoliberal policies, the effects of globalization, and economic restructuring. The expansion and deepening of markets has extended the links between the formal and informal sectors. At the same time, as Pérez-Sáinz (2000) argues for the case of Latin America, the distinction between the formal and informal has become increasingly vague. Market deregulation has blurred one of the basic distinctions that were used to differentiate between the two, e.g., the association of different forms of regulation with the formal sector, and its correspondent legal/illegal breakdown (Portes and Castells, 1989). Over time, it has become increasingly problematic to define where the formal market ends and the informal begins. The pressures of global competition, combined with market deregulation, have led to the "low road to development" associated with precarious types of employment. Likewise, large firms in the formal sector have increased their involvement with informalized production through outsourcing and subcontracting. As activists and consumer campaigns against exploitative labor practices of large international retail chains have shown, the links between large and medium MNCs and precarious working conditions are well known. New Employment Patterns, Informalization, and Women's Work 37 Second, the informal sector is no longer seen as the anomaly that will eventually be absorbed by the "modern" sector. On the contrary, the trend has been the opposite, as increasing global competition leads to lower production costs and is often justified in terms of low consumption prices. In fact, the "modern" sector is no longer exclusively identified with more formal and prestigious activities. In many cases, the public sector has become increasingly less attractive due to budget cuts and retrenchment, leading to a continuous erosion in wages and benefits (Tripp, 1987; Pérez-Sainz, 2000). Thus, the decline in the formal employment in many countries has enhanced the relative attractiveness of informal activities, particularly as a source of livelihood for many workers and households. Third, although the traditional association of informal employment with low skills and low productivity still holds, the last two decades have introduced changes. With the increase in outsourcing and subcontracting, many informal labor processes such as those resulting from subcontracting chains with core firms have their center of gravity in the formal sector. In this way, the core firms take up a principal role in the generation of informality and poor working conditions; however, the production they generate might no longer be associated with marginality nor with low productivity if technology transfers take place through outsourcing and subcontracting involving the use of modern equipment. Fourth, the expansion of informal activities in developing countries during the past two decades is taking place in a climate that has been emphasizing political rights, individual agency and empowerment. Yet the contradictions between these predominant discourses and labor market trends are quite obvious. In high income countries, the dismantling of the welfare state since the late 1970s, together with market deregulation and globalization, has resulted in the erosion of workers rights and labor unions (Tilly, 1995; Standing, 1999). Thus, Tilly, focusing mostly on Western Europe, has argued that while the rise of Western democracies led to the gradual and incremental establishment of workers' rights through the enforcement of contracts, intense labor struggle, and the creation of citizenship and democratic institutions, with globalization "great inequalities of economic power threaten democracy" (p. 22). However, in developing countries where the welfare state was weaker or hardly built, globalization has generated contradictory forces. To be sure, transnational investment has thrived on the existing lack of workers' rights in many developing countries, as exemplified by the restrictions of rights in many export-processing zones scattered around the globe.8 Yet, industrialization and individualization of decision making associated with markets can also contribute to the recognition of individual rights, even without a formal broadening of democratic institutions. For example, rural women's migration to urban areas for industrial and other forms of employment may foster 38 Benería their individual rights and increase their autonomy, releasing them from patriarchal practices even though, at the same time, they may be subject to discrimination and exploitative working conditions. Likewise, global links can generate pressure towards recognition of workers9 rights, as illustrated by some of the recent debates on this issue in international forums. However, these dynamics are likely to exclude much of the labor force working within the boundaries of informality. Finally, and related to the above, precarious jobs and economic insecurity translate into precarious lives and poor living conditions that appear to be a permanent feature of a large proportion of the population in developing countries. This is of course not a new phenomenon but, with labor market deregulation and increased flexibility in production, it has taken new dimensions. In particular, it has become a crucial phenomenon for our understanding of persistent poverty and increasing economic insecurity.9 The following quote from Kruse's study of urban employment in Cochabamba is very explicit in reporting how men and women working in semi-informal10 workshops and under very poor working conditions live their daily lives: [They] live a growing and powerful daily insecurity, with unpredictability in their unilateral labor contracts and mechanisms of retention, promotion, remuneration, and working time. In the face of such mechanisms, often the only option for defense, claim or resistance is to quit. To a great extent, these options explain their labor trajectories, marked by a notorious instability and horizontal mobility.... This limits the possibility to settle in any labor community and therefore the possibility to establish a social and political presence (Kruse, 2000). Thus, the vicious circle of poverty and powerlessness is perpetuated—for men and for women, and for entire households. As Kruse argues, such conditions are hardly appropriate for building stable communities and democratic participation in civic life. INFORMALIZATION AND WOMEN Given that women have tended to be highly involved in informal activities, we can ask whether there have been changes in the extent and nature of this involvement. Some observations can be made in this regard. First, the feminization of the labor force during the past three decades has intensified the reliance of many women on informalized employment. Table 1 shows that the proportion of women in the sector varies according to region. To the extent that self-employment reflects this trend, Charmes (1999) has estimated that, during the 1970-1990 period, the proportion of self-employed in the female non-agricultural labor force increased in all regions, including New Employment Patterns, Informalization, and Women's Work 39 Table 2. Self-Employment in the Female Non-Agricultural ___________________Labor Force__________________ % of self-employed in female non-agricultural labor force 1970 1980 1990 Developed 10.4 9.7 11.1 Africa 38.1 59.3 62.8 Latin America 28.6 29.2 32.1 Asia 27.9 26.7 28.7 World 24.0 28.4 27.6 Source: Charmes, 2000 (estimations based on national sources). the developed regions (see Table 2). More specifically, Table 3 illustrates the weight of informal sector employment and of women's contribution to GDP generated by this sector in various countries, showing that in some African countries like Benin, Chad, Mali and Kenya this contribution reaches levels above 50%. Although statistical information regarding the scope of informal activities where women concentrate is deficient, studies have shown that they range from subcontracting processes linked to export-oriented industrialization, including home-based work, to street vending and other trade and service activities that evolve around survival strategies. Subcontracted work and home-based production illustrate many of the problems associated with women's informal employment. A recent study of subcontracted work in five Asian countries11 shows that earnings lower than in the formal sector prevail, with no consistency of work contracts, difficult working conditions, and long hours of work (Balakrishnan and Huang, 2000). The study points out the difficulty of organizing workers Table 3. Employment and Contribution of Women in Informal Activities, Various Countries and Years Precent of women's i contribution in Informal sector Informal sector employment GDP Benin 1992 59.7 51.1 Burkina Faso 1992 41.9 61.4 Chad 1993 53.4 62.3 Mali 1989 71.9 68.2 Kenya 1998 60.3 46.2 Tunisia 1994-1996 18.1 15.7 India 1993 22.7 22.1 Indonesia 1998 43.1 39.5 Philippines 1995 46.3 44.2 Source: Charmes 2000; author's estimations based on official labor force statistics and national accounts. 40 Benería Table 4. Home-Based Workers, Various Countries and Years Number of % of non- home-based agricultural workers labor force % women Tunisia (1994) 86,267 4.8 71.3 Kenya (1999) 777,100 15.0 34.9 Benin (1992) 595,544 65.8 74.1 Thailand (1999) 311,790 2.0 80.0 Philippines (1993-1995) 2,025,017 13.7 78.8 Chile (1997) 79,740 1.8 82.3 Peru (1993) 128,700 5.2 35.3 Brazil (1991) 2,141,972 5.0 57.1 Brazil (1995) 2,700,000 5.2 78.5 Source: Charmes 2000 (estimations based on national sources). for the purpose of increasing their bargaining power, and it illustrates that "subcontracting makes it very difficult to hold one employer responsible for protecting workers' rights" due to "the many layers of chains" (p. 14). Another study still in progress differentiates between two types of home-based workers carrying out paid work within their homes—"independent own-account producers" and "dependent subcontract workers"—pointing out that the term "homeworkers" refers to the second category only (Carr, Chen and Tate, 2000). Table 4 shows that women represent the large majority of home-based workers in many areas, reaching beyond the 80% level in some countries. Although the variations between countries are large, the table shows that in some cases women represent a significant proportion of the non-agricultural labor force. Second, in the North as well as the South at least three dimensions of economic restructuring have implications for the informahzation of work affecting women: • At the micro level, restructuring has profoundly transformed the linkages between core firms and the different levels at which production has been decentralized; sweatshops and decentralized production through subcontracting provide examples across countries and industries. A study of the shoe industry in Spain for example has illustrated the ways in which the larger firms have reduced their size through the formation of smaller firms and decentralized production based on more informal labor contracts many of which have gone underground (Ybarra, 2000). Ybarra has estimated that total employment in the industry has been halved since the 1980s—despite the increase in the number of firms. Women have concentrated at the lower levels of production, particularly in home-based work in which labor norms are "rarely implemented" (p. 213). The underground work carried out New Employment Patterns, Informalization, and Women's Work 41 by women has been estimated to comprise between 35-40% of the work generated by the sector. • Layoffs and relocation of production often result in gendered transitions to new employment. To illustrate, some studies have documented gender differences in income loss (such as women's losses representing a higher proportion of their income than men's), in length of employment (also higher for women), and in the effects from layoffs and unemployment experienced at the household and community levels (Beneria and Santiago, 2001).12 • The literature on "commodity chains" and peripheral urban growth has also contributed examples of the ways in which labor market informalization can affect women. Gereffi (1994) and others have analyzed the connections between globalization and the formation of commodity chains through which large buyers tend to control the links between inputs and outputs. Along the same lines, Carr et al. (2000) have pointed out that technological change has facilitated "lean retailing" that demands the "quick and timely supply of goods associated with the just in time inventory system" (p. 126). According to these authors, this system has resulted in an increase in homework in the garment sector, particularly in countries close to the main markets of Europe and North America. Thus, the traditional precarious conditions in the informal sector have been reinforced by the dynamics of globalization in these new productive processes. Third, women's primary involvement in domestic and child care responsibilities continues to be a source of vulnerability for them, not only because it represents unpaid work but also because it diminishes women's mobility and autonomy to design their labor market strategies. The effort of the past two decades to account for and analyze unpaid work and its consequences for women's participation in paid production has not been sufficiently translated into practical action and policies. In developing countries, middle and upper class households can rely on poor women to take up the responsibilities of domestic work and child care. This is because domestic service still represents a very large proportion of women's employment in many low and middle income countries13. Yet, involvement in domestic and child care responsibilities continues to have an impact, even if different according to social background, on women's choices. This is not to view child care from a negative perspective but to point out that it has a differential impact by gender. Fourth, one of the differences between the earlier periods of informal-ized labor and the present time is the degree to which women have been able to take up actions at the national and international level. Structural adjustment and economic crises have led women to organize around labor 42 Benería issues as well as around tensions related to unpaid work and household survival strategies. A good example has been women's key role in getting the ILO Convention on Home Work approved in June of 1996. As Elizabeth Prugl (1999) has argued, it was a feminist victory, with some international networks such as HomeNet providing extensive information and using the special relationship that its members had built with unions in advance of the conference to get their arguments on the floor. Although its rate of ratification at the country level is still very low, it provides concrete goals and a regulatory tool around which to organize further action. Other organizations exist focusing on women and informalized work, such as the Self-Employed Women's Association (SEWA), which has gained international notoriety for its accomplishments, and WIEGO (Women and Informal Employment Globalizing and Organizing), which has organized a network of workers, activists and academics focusing on the informal sector, including home-based workers. CONTRADICTORY TENDENCIES FOR WOMEN'S EMPLOYMENT Despite the pessimism that we can derive from the above analysis, during the past three decades there have also been positive changes that need to be taken into consideration in order to evaluate the more complex and often contradictory tendencies affecting women's work. A large proportion of the literature has tended to emphasize the poor conditions under which traditional female employment has taken place. Across the globe, female employment has for the most part been identified as linked to exploitative conditions, low productivity and low pay. Yet, these generalizations need to be qualified. As women's educational levels and labor force participation have been gradually increasing—in some cases dramatically—the dynamics of women's employment has become more complex. First, gender gaps in education have been decreasing significantly across regions. For example, the Arab countries have experienced some of the most dramatic increases in women's educational levels, with women's literacy rates doubling during the 1970-90 period. South East Asia and the Pacific countries also made considerable progress during the period, and in many Latin American countries educational indicators for women have surpassed those of men (UNDP, 1999). As Fig. 1 indicates using 1997 figures for net enrolment ratio in secondary education, this was the case for sixteen out of the twenty-six Latin American and Caribbean countries; it was also the case for some countries in each of the regions except for Northern Africa. This improvement in women's educational status is a crucial step towards gender equality and women's advancement. Yet, while a correlation exists between New Employment Patterns, Informalization, and Women's Work 43 Sub-Saharan Africa Asia and the Pacfic Guinea Chad Benn 31 0 , Central African Rep Wl j Guinea-Bissau bil Togo *MI Niger KM Cote ďlvoŕe Ml Ethiopia at>! Mai ttl Burkha Faso Wl Malawi sa Gambia W Mozambique 02 Congo, DR Senegal Ö 3 1 Djibouti E i\ Burundi ill\ ' Zambia 7n Cameroon 771 Congo /y Comoros * W2 1 1 • 82 Eritrea BM 1 Kenya BMI Eq. Guinea yui I Zinbabwe - yi • 1 Swaziland ym I Cape Verde «41 South Africa 1Ů« 1 1 Mauritius < v , 11 ?l 1 Botswana 11 s 1 Namfoia 1 mi 1 Lesotho \u (L_ —1—1—1—1— Nepal Bandadesh Cambodia India LaoPDR Vanuatu Iran, Islamic Rep Chha Indoles b Myanmar Viet Nam Thaibrri Singapcre Koiea, Republc Fii Philppries Brunei Daiussabm Hong Kong, China SAR Sri Lanka Mabysia Mongdia —Lsffll 1 U ~-ööl - ■ ÖÖ I 1 1 - bBI 1 1 1 - < 721 1 -/ J. -± J - & i 1 ' ' >~W ' X É ö 1 1 ' j -'<< J p.ťol 1 » ', ~ * Íf\r\ i ' ' *i J 1 1 y/i J 1 i «n J 1 1 yai i 1 1 w 1 ' ' iyy 1 1 1 iu2 i 1 1 l ^íoin \ ' ' ...1. 107 1 i ' ' 1 -1091 j i i Ľ, - 115 I j i i I - J~ Idi \ J—\-U— ------1------1------, 20 40 60 80 100 120 140 % Gender Gap Closed Cental andWesfern Asa 20 40 60 80 100 120 % Gender Gap Closed Northern Africa Morocco 741 I I Egypt -BÖI I I I Algeria < - 881 I I I Tunsia •yi>i I I I Libya 1UU 2 0 4 0 6 o e 0 1 30 1 20 140 , .,. I j. . . Iraq Turkey ------1_------i-721 Saudi Arabia * - al Syria Ü2 Oman + . » _ ._. ^SDI 1 1 1 Qatar H/l 1 1 1 Georgia - - m i i i Kuwat J 1UU 1 1 1 Kyrgyzstan — <.*■- ĺ. V 105 1 1 1 UAE 11 if] 1 1 1 Bahrain -----------,-----------,_____ 1 an 20 40 60 80 100 120 ' % GenderGap Closed • Source: Progress of the World's Women. 2000. New York: TJNTFFM Fig. 1. Secondary net enrollment ratio, female/male, 1997*. 44 Benería Latin America and the Caribbean i Guatemala - -831 Bolivia .- ~ 86 1 Barbados -"-.- ■. «M 1 Peru -v; _,„V4 | Mexico ^ - - 941 Haiü - , — .*» | Paraguay - . ^^j.y/1 Belize .* -- , - -.y/ | Ecuador *-"--* -- r-IOI- Panama ^-cJ^JŮ!.' Trinidad and Tobago ^«n^.-^102 | 1 El Salvador ^Hri --IÖ2 I Brazil v. ,-_* 1ÜJ 1 Guyana *>**-< h> ^IU4 1 Costa Rica -.it r_ ^jo» j Colombia n , il» 1 1 I1 Chile 1 't .V- < rJUM 1 ] Jamaica - -J- f ^ i inj 1 I I - f*j=ss**-~>(-->7*&*:*x5^T\X}- 1 I ">- A- .-v £ AfftP Aid Uli ťjjjftft^-riijicrrj 1-----T .^4.102 1 1 I .„J, TOT] 1 I I "^ n—r TToah ■ ^■-c^f-gtl-H?- I I --^1U4J =P=F uk 20 40 60 80 100 120 140 % Gender Gap Closed Eastern Europe Bulgaria Latvia Czech Rep. Romania Croatia Hungary Estonia Poland Russen Fed. I 1 I—T t^in» t^dr^^-yTml TT *■*■,■=.-"- my I I 80 100 120 140 ' Source: Progress of the World's Women 2000. New York: UNIFEM Fig. 1. (Continued) New Employment Patterns, Informalization, and Women's Work 45 schooling and labor force participation, and while this correlation tends to be higher for women than for men, women's educational achievements do not necessarily translate into labor market gains.14 Obstacles to women's advancement such as those resulting from occupational segregation and discriminatory practices reduce these possible gains. In addition, the progress made in women's education is far from complete. For example, gender differences in illiteracy rates and other indicators of educational achievement are still substantial in many countries. Illiteracy rates are extremely high in some African and Asia countries while female primary and secondary school enrollment has not achieved parity with men in many countries.15 To the extent that high concentration of women in inf formalized production can be partially a result of their lower educational status, educational policies are crucial to deal with women's economic insecurity. Second, there are clear indications that women's higher educational levels and rising labor market participation have benefited those who have moved into managerial and professional occupations. This seems to contribute to an increase in income inequality among women; the benefits received by women at higher educational levels must be contrasted with the precarious conditions for the large majority. Although more studies are needed to document this tendency for different countries, available evidence for Brazil and the United Sates points in the direction of what McCrate has called a "growing class divide among women" (Lavinas, 1996; McCrate, 1999). Third, despite this persistence of gender discrimination and obstacles to women's advancement, women's relative wages have improved in relation to male wages across countries. As Fig. 2 indicates, in industry and services this has been the case for twenty-two out of twenty-nine countries, including high and low income countries. Similarly in manufacturing, wage disparities have increased for twenty out of twenty-two countries. For the transition economies of Eastern Europe, Fig. 2 also shows an improvement in women's relative wages for four out of seven countries. Yet, despite this tendency in the right direction, no country has achieved wage equality; the female/male wage ratios shown for 1997 range between a low 45% for South Korea to 95 % for El Salvador, followed by Australia, Sri Lanka, and Sweden (90%). A related issue is that the level of formal education does not assure that women will be able to upgrade their skills with the speed required by technological change and shifting labor markets. Fourth, much has changed since Ester Boserup (1970) emphasized the need to "integrate women in development." As she saw it, women had lost out in the process of development for a variety of reasons. One of them had to do with the ways in which industrialization, particularly under import substitution policies, had resulted in the marginalization of women due to 46 Benería Industry aid Services, c 1980-1997 GcndarG^FalIb Manufacturing, a 1980-1997 Gender Gap Falls Urugujy United Kingdom SriLaika Singapore Farqjuay Panama NewZedand Luxanbouig Korea, Republic Jordan Honduras Guatemala Egypt Ecuador Cyprus Costa Rica Colombia Draal Bolivia Belgium Australia Atgcntina United Kingdom fj Switzerland f Sweden f Swazfend f Sri Lanka F Norway F New Zealand f Myanmar f Luxembourg I Korea, Repubßc f Iceland F Greece f France f Fhland [ El Salvador I Egypt ] Cyprus | Costa Rica Belgium | Australa 0 20 40 60 80 100 Female Wagesas % of Mae W^es Gender Gap Does Not Fall Venezuela Switzerland Netherlands Mexico j France Iceland Chile " iiBjuiwrm™ , B7 0 20 40 60 80 100 Female Wages as % of Male Wages ^Source: Progress of the World's Women 2000. J Fig. 2. Change in female wages as % of male wages. 4995 �99452499449 1995 B1$3A 1991192895959449 New Employment Patterns, Informalization, and Women's Work 47 the replacement of craft industry with modern industry employing predominantly male labor. This preference for male workers must be contrasted with the preference for women workers observed in export-led industrialization contributing to the feminization of the labor force.16 This preference has mostly rested on the availability of women as the cheapest and most flexible labor pool—from the Asian NICs to maquila production in Latin America. Although this industrialization has provided many illustrations of the pre-cariousness of women's employment, it has also contributed to increasing women's income and autonomy, therefore generating contradictory results. Thus, we can distinguish between three different outcomes resulting from the feminization of the labor force: • Cases that represent an improvement in women's condition, even without eliminating gender inequalities. Lim for example had argued with respect to the South East Asian countries that rapid export-led growth benefited women by providing them with formal, well-paid employment. In particular she argued that multinational firms paid higher wages than national capital (Lim, 1983). Subsequent research has not contradicted this argument, but it has added a different dimension, namely that rapid growth in South East Asia was partially based on gender inequality, and more specifically wage inequality. As Seguino (2000) has argued, low female wages served as an incentive for investment and exports, "by lowering unit labor costs, [and] providing the foreign exchange to purchase capital and intermediate goods which raise productivity and growth rates" (p. 1). • Cases in which little or no improvement has been observed. A study focusing on the maquiladora system along the US/Mexico border for example shows that Lim's optimistic argument has not applied to this area. Using a Labor Trajectory Survey for Tijuana, Fussell (2000) argues that maquiladora wages have not improved as employment has expanded in the area. This contradicts, as Fussell points out, Lim's assertion that export-oriented employment would raise wages for all workers and improve women's labor market position. The difference is related to the different conditions prevailing in Mexico in comparison with the South East Asian case; while the maquiladora area has continued to attract an almost unlimited labor supply, the rapid growth in South East Asia resulted in tight labor markets and high productivity increases. • We also observe cases of mixed results, as reported in Ozler's recent study of gender differences in employment in Turkey's export-led industrialization (Ozler, 2001). Based on a large data set of Turkish manufacturing, she argues that trade liberalization has lead to the 48 Beneria feminization of the labor force, with job creation for women significantly higher than for their male counterparts, however the volatility of women's jobs is also significantly higher. Thus this case reflects the preference for women workers in jobs that are insecure. A different possibility for mixed results can arise in cases of de-f feminization of the labor force, for example, when technological change is gender-biased against women.17 Taken together, these studies imply that the initial 1970s literature emphasizing the exploitative character of women's employment by MNCs was simplistic. In particular, it did not take into consideration the range of variations in labor market conditions between countries. Finally, much has changed also in terms of women's agency, as illustrated above, and in terms of the profound transformations in gender roles, particularly but not exclusively those of women. Richard Anker's study (1996) of gender segregation across countries has shown that, during the past three decades, men have been losing their labor market advantage—in the sense of having their "own" occupations protected against female competition. There are, however, some exceptions, and results differ between countries and regions. Anker's analysis for the OECD countries, for example, illustrates the extent to which the increase in women's labor force participation has taken place in female-dominated occupations, particularly in the 1970s, as well as in male-dominated occupations (in the 1980s). We have come to view gender and gender differences in a dynamic way, reflecting its changing meanings over time. As Mathew Guttman (1996) has shown in his study of changing relations in Mexico City, "Gender identities, roles and relations do not remain frozen in place, either for individuals or for groups" (p. 27). This implies discarding stereotypes about the gender division of labor, employment conditions, and other factors affecting gender relations and gender differences. It also implies that a focus on women only is incomplete and often inaccurate for any type of gender analysis since it leaves out its relative and dynamic nature. Finally, it underlines the importance for women to remain vigilant and focus on their bargaining power. CONCLUDING REMARKS This paper argues that the enormous increase in precarious employment and informalized production that has resulted from globalization and the implementation of neoliberal policies needs to be understood within the context of the changes taking place at the micro-level of the firm. These changes represent a massive redistribution of resources away from labor and an increase in social inequalities across countries. They are also at the New Employment Patterns, Informalization, and Women's Work 49 root of the stubborn persistence, and even increase, in poverty and economic insecurity in many areas, including high income countries. An implication is that poverty eradication programs must emphasize the need to generate decent jobs without which these programs will continue to be ineffective. Action is needed at different levels, from the adoption of new forms of social protection to international agreements on core labor standards and minimum wages. Given the extent to which resources have shifted from public to private hands during the past decades, the time has come to put pressure on the private sector for its responsibility in the creation of precarious jobs and living conditions. In the same way that, during the past two decades, the environmental movement has succeeded in point at the responsibility of private firms for environmental degradation, a similar effort is now needed to address precarious employment and distributive mechanisms» The case of subcontracting and outsourcing is a good example; large firms constitute the center of gravity in the creation of subcontracting chains, yet they have represented an avenue through which previously acquired labor gains in terms of wages, working conditions and other benefits have been reduced. This raises the question of whether and how this trend can be reversed or changed, and in what ways subcontractors and workers in the periphery could participate in some of the benefits provided by core firms. The responsibility of the private sector in responding to these questions and dealing with the roots of poverty and inequality should be emphasized.18 The voluntary adoption of codes of conduct on the part of large MNCs is an encouraging sign in this direction. However, it only represents an imperfect solution and small proportion of the huge task ahead. Regarding women's work, this paper argues that women's employment has been affected by multiple factors that have led to the informalization of labor markets. This includes women's participation in the informal sector and their high concentration in precarious jobs. However, contradictory forces need to be taken into consideration, particularly in terms of the improvement in women's educational levels and the preference for women's labor in low-wage employment. The improvement in educational levels does not always result in corresponding gains in labor market conditions for women. At the same time, the observed preference for female labor in export-led employment is often accompanied by greater insecurity of women's jobs in comparison with men's, even if all jobs are becoming less secure. This calls for policies to solidify and upgrade women's educational gains, particularly in view of rapidly changing technological requirements for labor. Most of all, given the connection between precarious jobs and poverty, women and their families will benefit from policies addressing the problems of labor market insecurity, low pay, and gender discrimination in informal employment. 50 Beneria Social insurance schemes are necessary to deal with the threads of economic insecurity facing a large proportion of the population. ENDNOTES 1. These estimates indicate that during the past few years the service industry in California, which has a large proportion of temporary workers, has added as many jobs as the software and electronic equipment industries combined (TE, 1/29/00). 2. The decrease in job tenure for men 55 and over has been particularly sharp, with an acceleration of this trend since the early 1990s. For more detail, see "Career Evolution," TE, 1/29/00. 3. For example, young workers prefer longer working days in order to have longer weekends, and older workers opt for more traditional weekly schedules (WSJ, 3/13/00). 4. Hence the reliance on immigration to fill job vacancies at the bottom of the labor hierarchy and, in cases such as Germany, the efforts to facilitate the immigration of computer technicians despite protests on the part of some groups. 5. In the United States, at least, this is illustrated by the prevalence of "poaching" or the "stealing" of high level executives and professionals from competitors (Schellhardt, 1997). 6. For some countries, unemployment rates reached higher levels, such as in Argentina (14.5%), Colombia (19.8%), Panama (13%), and Venezuela (15.3%) (Perez-Sainz, 2000). 7. Kruse reports the case of a worker in a blue jeans workshop who, after asking the owner's wife whether the workers would get a day off on May Day, she replied: "Do you suppose you are a worker?" 8. The literature on this subject is abundant. See, for example, US Department, Bureau of International Labor Affairs, Workers Rights in Export Processing Zones, Washington, D.C., 1989-90. 9. Standing (1999) has analyzed the different forms of labor market insecurity generated by these processes. The following is reproduced from a recent article of his (Standing 2001): • Labor market insecurity has grown almost globally, with much higher unemployment, slower rates of employment growth and higher "labour slack" • Employment insecurity is high and rising, with growing proportions of those in the labour force having insecure employment statuses and with more workers lacking employment protection • Work insecurity has become greater, due to more people being in work statuses without coverage by protective institutions and regulations • Job insecurity has worsened, with more workers having to switch jobs and learn new tricks of working • Skill reproduction insecurity is considerable, in park because skills become obsolescent more quickly and because few workers are receiving career skills • Income insecurity is greater for those employed, due to flexible wages, and so on, and for those outside formal employment, due to implicit disentitlement to benefits • Representation insecurity is growing due to de-unionization, erosion of "tripartite" institutions and the changing character of collective bargaining. 10. That is, workshops that are difficult to classify because part of their operations are legal while others are not. 11. The Philippines, Thailand, India, Pakistan, and Sri Lanka. 12. Beneria and Santiago's study of a large firm's relocation from New York state in the US to Tijuana, Mexico, shows that, although all workers suffered a dramatic decrease in their annual income when comparing the new with the old jobs, the relative decrease for women was 35% of their previous income and for men 26%, even though in absolute terms men lost a larger amount than women (an average loss of $8,147 and $7,727, respectively). The length of unemployment from the time of their lay-off until they found a new job was 11.8 New Employment Patterns, Informalization, and Women's Work 51 weeks for women and 9.5 weeks for men. The study reinforces the findings of previous research on these issues, reported in the paper. 13. To illustrate with the case of Brazil, estimates of the proportion of employed women in domestic service range between 16% and 20%; one study found an average of 19% for the 1990s decade (Beneria and Rosenberg 1999). 14. For an analysis of these issues for the Brazilian case, see Beneria and Rosenberg 1999). 15. To illustrate, the 1997 illiteracy for women was 97.1% in Ethiopia, 92.8% in Niger, and 79.3% in Nepal (UNDP, 1999). 16. An extensive literature exists about this topic. For a summary, see United Nations, 1999. 17. The reasons for this can be varied, ranging from the greater possibility for men to upgrade their skills when new technologies are introduced to changes in work schedules (Beneria, work in progress). 18. A pending suit against Microsoft Corporation in the United States provides an interesting example illustrating the shifting boundaries between distributive channels benefiting different actors. 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