Growth for Latin America, Gains for Women?

An Overview of Women and the Economy in Latin America

By: IMOW Team
Submitted: 11/01/2010

As the world struggles to recover from the global economic crisis, pundits, policy makers, and workers are all left wondering where the chips will fall. Many economists predict that future growth of the global economy will rely on emerging economies in developing countries; others have predicted that women, an often overlooked segment of the global labor force, will finally take their full place in the world economy.

If these experts are correct, women in Latin America are in a particularly favorable position.

From 2003 to 2008, Latin America experienced its highest rate of Gross Domestic Product (GDP) growth since the 1970s, growing at an average of 5.5%. The worldwide economic crisis that began in 2008 has dampened growth, but in 2010 analysts project that the region's economy will expand once more. Some predict that the next ten years will be the "Latin American decade," a period in which the region will assume a more powerful position in the global economy.

While Latin American women are expected to be key to this growth, they also face some daunting obstacles, including deeply-engrained social structures that oppress women, a dominant informal economy, and a slow start on enforcing policies that encourage gender equity. So how do women fit into the economic future of Latin America? And what challenges lay ahead?

 

The Big Picture: Wealth Inequality

Latin America holds the inglorious title of being the region with the widest wealth gap between rich and poor in the world. In Argentina, for example, the richest 10% of the population earn more than 40% of the country's income, while the poorest 10% earn barely 1%.

Although over a third of the region's inhabitants are still poor, during the region's recent growth poverty was reduced dramatically. Today, 37 million fewer Latin Americans are considered impoverished compared to a decade ago. However, women in Latin America remain particularly vulnerable to poverty, and are almost 17% more likely than men to suffer from extreme poverty. In fact, the likelihood of a woman being poor has actually increased over the past ten years.

One Step Forward, Two Steps Back

Despite persistent inequities, women have not been left behind. One hundred million women in Latin America are working paid jobs outside the home-more than ever before.

But while taking on more work has improved women's lives, higher rates of employment don't necessarily mean a better quality of life. More than half of all working Latin American women are employed in the informal economy, a sector that isn't taxed or included in a government's measure of GDP. Women working in the informal economy don't receive benefits, salaries or the protection of safety regulations; they're also particularly vulnerable to cuts in hours or job loss. In addition, the informal sector often pays poorly-in 2006, prior to the crisis, 33% of workers in the informal sector were poor, compared to 16% in the formal sector. However, even those women who do work in the formal sector earn just 75 cents for every dollar a man makes. This regional wage gap is notably higher than the global average of 84 cents to every dollar earned by a man. And throughout Latin America, women remain noticeably absent from top corporate positions.

Women also perform the vast majority of unpaid care work, often working almost three times as much as men on "volunteer" house work. The economic crisis has pressured governments to cut spending on social programs, including childcare, healthcare and education, further increasing women's burdens at home. In fact, more than half of Latin American women aged 20-24 say they're working so much at home that they cannot seek paid work.

Unemployment and Decline in Work

The economic crisis led to a marked decline in women-led industries such as tourism and exports. Now, more than 10 percent of Latin American women are unemployed (compared to 8.8 percent at the start of the crisis).
Seventy-five percent of working women in Latin America are employed in the service industry (which includes tourism, domestic workers, and care work)-a far higher number than the global average of 18 percent. The tourism industry was especially affected by the crisis, since it is extremely susceptible to falling incomes.

Less Money for Home: Migration and Remittance

As work opportunities diminished at home, an estimated three million Latin American women migrated to a new city or country in search of paying work. Remittance, or money sent from a spouse or other family member working in another country, are an essential part of many Latin American incomes and of many country's overall GDPs. During times of economic crisis, work abroad is less dependable and migrants earn less money to send back home. This affects women on both sides of the border: those who migrate work harder for less pay and are more vulnerable to exploitative working conditions or underemployment, and those women who stay at home are often dependent on remittance that may not come.

In 2009 Latin American countries received about $58.8 billion in remittance-a fifteen percent drop compared to 2008. Less remittance make it more difficult for women to maintain their household and feed their family. Some experts predict that remittance will stabilize, and perhaps even increase, over the course of 2010. 

Violence in Times of Crisis

Throughout Latin America, the legacy of machismo (a longstanding tradition of male superiority and dominance of women) persists despite advances in women's rights and political participation. The crisis has unleashed and renewed some aspects of machismo, and violence against women has increased in the years since the economic meltdown. For women with unemployed partners at home, the stress of uncertain work, underemployment and not enough money have exacerbated levels of domestic violence. In some countries, femicide or feminicide is not unusual. 

Some experts say that violence against Latin American women might be due in part to women's increased economic autonomy and education . Maria Flórez-Pimental Estrada of the Agenda Económica de las Mujeres UNIFEM program says these facts "constitute a powerful defiance of masculine privileges which may explain, though never justify, the violent masculine response to this power loss of men over women." 

A Shift Towards Women-Friendly Policies

In the years before the crisis many Latin American governments began policies to reduce inequality, help the impoverished and-ultimately-benefit women. 

One example is government cash transfer programs, a type of welfare unique to the region where financial incentives are offered to low income households as long as certain conditions are met, such as regular school attendance and health check-ups for children. Cash transfer programs have assisted some 110 million Latin Americans. These programs can help some women, but ultimately don't offer enough assistance for women and families to overcome other barriers to social mobility, such as quality education, stable employment and good childcare. 

Some governments have also launched innovative pro-poor, pro-women policies. For instance, leaders in Uruguay and Chile initiated programs to improve childhood education and provide more protection for domestic workers. Governments in Chile, Mexico, Argentina and El Salvador have enacted measures to increase female employment; Mexico has added government counselors to assist women looking for work; and Argentina created a program to increase women's enrollment and retention in general education and occupational training, with special efforts to increase the hiring of women over 45 years of age.

Women Take Control

Besides being the beneficiaries of women-friendly public policies, women in Latin America are taking control, making innovative changes and improving their quality of life. For example, groups of working women have banded together to develop participatory work cooperatives, such as Coopa-Roca in Brazil, where women in one of Rio's poorest neighborhoods are paid a fair wage to sew high-fashion garments for designers. These democratically-run cooperatives empower women by fostering independence, self-esteem and financial stability.

Latin American women are also taking advantage of educational opportunities. In many countries, women's levels of education have achieved parity with men, and in some countries-such as Argentina and Brazil-more women than men are enrolled in college. 

In addition, women in Latin America are being elected to public office at rates that surpass the United States and other developed countries. For instance, in Costa Rica and Argentina, about 40 percent of the legislators are women, compared to the U.S. average of 17%. Notably, several women have recently been elected heads-of-state, including Laura Chinchilla in Costa Rica, Christina Fernández de Kirchner in Argentina, and Brazil's new president-elect Dilma Rouseff.

Brighter Days Ahead

With Latin America positioned to take a more central place in the global economy, women in the region are also poised to reduce longstanding gender inequities. In fact, unless the region is able to accept and engender parity between men and women, it is unlikely that it will reach its full economic potential: a 2010 special report on Latin America in The Economist noted, "The causes of Latin America's relative failure to develop are the subject of intense ideological debate there today...many serious scholars blame the regions extreme and persistent inequities."

Thus, as the region anticipates potential growth, stability, and power, the place of women in Latin American society should remain a central question. If structural shifts in government and society match the strides made by Latin American women as they work outside the home, move from the informal to the formal sector, create innovative solutions to work inequities, and take advantage of women-friendly programs and public policies, the entire region stands to benefit and make enormous advances in the coming decades.