labor policy in pakistan

insafresearchwinsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafre

searchwinginsafresearchwingins

afresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafredisciplinejusticehumanityequalityfaithpietydis

Labor Policy in Pakistan

Committee:

IRWInsaf Research Wing

Finding solutions for a better Pakistan

“Currently, the government of Pakistan is spending about 2 percent of the GNP on education. This is insufficient, given the educational needs of the country. The government must commit to allocate a higher percentage to the education sector, and to proportionally allocate this to

various sub-sectors of education, especially women’s education.



afresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresea

fresearchwinginsafresearchwinginsafredisciplinejusticehumanityequalityfaithpietydis


April 13, 2012

Author: Amna Khan

Committee: Socio-Political Committee

Dossier # 001

Version # 001

Policy

IRWInsaf Research Wing

Finding solutions for a better Pakistan

Insaf Research WingCentral SecretariatStreet No. 84, Sector GIslamabad, Pakistan.Tel: 92Fax: [email protected]

Pakistan Tehreek

Currently, the government of Pakistan is spending about 2 percent of the GNP on education. educational needs of the country. The government must commit to

allocate a higher percentage to the education sector, and to proportionally allocate this to

sectors of education, especially women’s education.”



afresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresearchwinginsafresea

fresearchwinginsafresearchwinginsafredisciplinejusticehumanityequalityfaithpietydis

Insaf Research WingCentral SecretariatStreet No. 84, Sector G-6/4, Islamabad, Pakistan.Tel: 92-51-2270744Fax: [email protected]

Pakistan Tehreek-e-Insaf

Currently, the government of Pakistan is spending about 2 percent of the GNP on education. educational needs of the country. The government must commit to

allocate a higher percentage to the education sector, and to proportionally allocate this to

Committee on Socio-Political Labor Policy in Pakistan

Insaf Research Wing

Insaf Research Wing (IRW) is a part of Pakistan Tehreek-e-Insaf (movement for justice a political party, PTI). IRW was created in 2009 to carry out research in order to find solutions for problems in Pakistan. The foremost goal of IRW is to keep people of Pakistan and PTI informed and prepared.

The wing is composed of 10 committees. Each committee addresses issues related to its field of expertise. The committees defined as of yet are (i) Socio-Political (ii) Information & Technology (iii) Economic (iv) Energy (v) Healthcare (vi) Corruption (vii) Foreign Affairs (viii) Education (ix) Environment (x) Strategic Thinking.

The research reports/papers are either commissioned by the central executive committee of PTI or committee members of IRW. PTI members can also suggest IRW to consider researching on a matter they find important. IRW welcomes any contributions in the form of scholarly work addressing important issues. Nevertheless, after the author(s) sends the document it is peer reviewed before getting published. In the process of peer review the document is technically analyzed and scrutinized. The procedure is necessary to maintain quality control. However, varying opinions & ideas are not penalized.

Apart from working on research reports/papers which shed light on problems and provide basic solutions, IRW undertakes the task of preparing extensive policies for PTI. These detailed and in-depth policy documents are a combination of input from several professionals who are well versed in the subject. IRW also serves as a check on the reigning government’s policies.

The Wing does not follow a preset ideology while carrying out research. IRW does not endorse any opinion presented in a published report/paper as an official position. Likewise, several research reports/paper on a similar subject published by IRW can have contradictory recommendations though it should be noted that these point of views are sole responsibility of the author(s). Very rarely when there is a complete consensus on a certain research report/paper within IRW only then it is recommended to PTI for official perusal. Any published document by the wing does not constitute it as an official position of PTI unless otherwise stated.

Insaf Research Wing works at a national level but its members are located throughout the world bringing in the much needed international experience. IRW practices an open membership policy valid for all Pakistanis regardless of religion or race. Nevertheless, members of other nationalities from international organizations interested in helping Pakistan are always welcome to join IRW.

Published reports of IRW can be accessed at PTI’s website www.insaf.pk. The headquarter of IRW is located at PTI’s Central Secretariat, Street No. 84, Sector G-6/4, Islamabad, Pakistan.

Copyright © 2009 by Pakistan Tehreek-e-Insaf All rights reserved.

The contents of this report/paper cannot be reproduced without prior permission of IRW.


Insaf Research Wing

Table of Contents

INTRODUCTION ....................................................................................................................................................................... 5IMPORTANCE OF THE STUDY OF LABOR MARKET POLICY.................................................................................................. 5PAKISTAN- AN OVERVIEW........................................................................................................................................................ 5PROBLEM OF ACCESS AND EQUITY......................................................................................................................................... 6LABOR POLICY IN PAKISTAN................................................................................................................................................... 6FEMALE LABOR PARTICIPATION.............................................................................................................................................. 7DEFINITION OF FEMALE LABOR PARTICIPATION ................................................................................................................... 7RANKINGS ON INTERNATIONAL INDEXES ............................................................................................................................ 7THE SIGNIFICANCE OF WOMEN’S WORK ............................................................................................................................ 7FACTORS THAT DETERMINE WHAT KIND OF WORK WOMEN DO................................................................................ 8FORMAL SECTOR....................................................................................................................................................................... 8WOMEN’S EMPLOYMENT ORGANIZATIONS AND TRADE UNIONS................................................................................... 9

DIFFERENCE BETWEEN GENDER ON WAGES, INDUSTRY PARTICIPATING ..................................................................... 9ECONOMIC POLICY REFORMS ........................................................................................................................................... 9WAGE GAPS BETWEEN GENDER ......................................................................................................................................10VOCATIONAL TRAINING OF WOMEN .............................................................................................................................12

RECOMMENDATIONS .............................................................................................................................................................12CHANGING SOCIAL INSTITUTIONS IS CUMBERSOME, BUT STILL POSSIBLE...................................................................12ADDRESS THE EDUCATION NEEDS OF WOMEN.............................................................................................................13

THE GOVERNMENT OF PAKISTAN SHOULD SPEND MORE ON EDUCATION .........................................................13THE GOVERNMENT AND THE INTERNATIONAL NGOS SHOULD COLLABORATE TO BUILD MORE SCHOOLS AND TRAIN MORE TEACHERS ...............................................................................................................................................13MAKE PRIMARY EDUCATION FREE AND COMPULSORY FOR BOTH MALE AND FEMALE STUDENTS.....................13THE GOVERNMENT SHOULD IMPROVE ADVOCACY AND OUTREACH TO PROMOTE FEMALE EDUCATION.......13ESTABLISH AN INDEPENDENT MONITORING AND EVALUATION MECHANISM TO OVERSEE EDUCATION DELIVERY........................................................................................................................................................................................13

DEVELOP ENTREPRENEURIAL OPPORTUNITIES FOR WOMEN......................................................................................14PROMOTION OF SMALL MEDIUM ENTERPRISES.........................................................................................................14THE INTERNATIONAL DONOR AGENCIES CAN CREATE ENTREPRENEURSHIP DEVELOPMENT PROGRAMS FORPOTENTIAL WOMEN ENTREPRENEURS........................................................................................................................14ESTABLISHING/STRENGTHENING WOMEN’S BUSINESS FORUM................................................................................14THE PUBLIC BANKS IN PAKISTAN AND THE FINANCIAL NGOS SHOULD DEVELOP AND ENHANCE MICROFINANCE INSTITUTIONS................................................................................................................................................................14

CONCLUSION .........................................................................................................................................................................14BIBLIOGRAPHY.........................................................................................................................................................................16ABOUT THE AUTHOR ............................................................................................................................................................16


Insaf Research Wing

Executive Summary

This paper examines gender discrimination at the labor market in Pakistan and how they were addressed by

the labor policy of 2010. The paper identifies labor issues related to women in Pakistan, and explain their

significance with context to the working of the economy. It also provides recommendation guidelines to the

government of Pakistan to help resolve these issues.

The main issues facing women are:

Low enrollment in schools. The literacy rate which is 54 percent for both males and females - drops

to 35 percent for females.

Low labor market participation. In 2009, Pakistan had 22 percent of women in the labor force

according to International Labor Organization. They also face multitude of problems at workforce in

the form of sexual harassment, low career progress and low wages.

This problem requires immediate attention and commitment of the government of Pakistan, International

Agencies such as the UN and ILO. The following recommendations will be instrumental in mitigating this

problem

Increase women education by increasing spending on education by the federal government, building

more schools, making education compulsory for all children irrespective of gender, improving

advocacy and outreach to promote female education and establishing a monitoring and evaluation

agency to oversee education delivery

Increase entrepreneurial opportunities for women by promoting small medium enterprise by women,

introduce entrepreneurial vocational training for women. Establishing business forums for women

entrepreneurs and lastly by expanding opportunities of microfinance.


Insaf Research Wing


To have an adequate appreciation of the far-reaching effects of disparities between women and men, we have to recognize the basic fact that gender inequality is not one affliction, but many, with varying reach on the lives of women and men, and of girls and boys. Amartya Sen

Introduction

Labor markets are institutions where work is exchanged for wages. In the current economic literature stream, studying economic labor markets is gradually becoming more important. The literature, however, focuses more on developed countries. This paper will examine labor markets in the developing countries. I will use the case study of Pakistan and look at various labor issues in Pakistan and how effectively they were addressed by the labor policy of 2010. The primary aim of this paper is to identify labor issues related to women in Pakistan, and to explain their significance. The secondary aim is to provide recommendation guidelines to the government of Pakistan to help resolve these issues. In this paper I will stress more on the gender issues in the market as I see them as a market failure, which is pushing the country away from the natural equilibrium. A very basic assumption of an operating labor market is that it will function efficiently without any market failures. I feel that this assumption does not hold true for the case of Pakistan. The recommendations provided below will not be exhaustive but can act as guidelines for the government to combat the labor issues related to gender.

Importance of the study of Labor Market Policy

The Human Capital Theory has been proposed by Schultz(1961) and developed extensively by Becker(1964). HCT challenges the notion that

labor is homogenous and instead focuses on labor differentials based on skill sets that labor possesses. The theory states that increase in education or training increases workers productivity and increases their income. Any spending on education and training should, hence, be considered as an investment decision. Any investment on education will increase both personal and national income as the skill sets of its citizens will increase. But why should we study labor markets and labor market policies? Human Capital theory rests on a key assumption of well functioning labor markets. A person’s economic wellbeing is determined by how much s/he and other family members earn for their labor and by what goods, services, and cash they receive from the government, the community, andothers. Even with multilateral and bilateral assistance, governments in developing countries lack the funds necessary to make a significant difference in poverty rates through governmentspending. This means that creating more and betterearning opportunities for the poor is the only option available to pull these people out of poverty. It is hence even more important to create well functioning labor markets in the developing countries. This section elaborates on the importance of human capital theory both as a tool to increase Gross Domestic Product as well as to reduce poverty among the citizens. Due to the importance that Human Capital Theory(HCT) has, it should be at the core of economic development planning.

I will now move on to give a brief demographic outline of Pakistan and the labor issues that the country faces.

Pakistan- an overview

Pakistan gained independence from the “British Raj” (British Empire) on 14 August, 1947. After 60 years of independence, Pakistan is still ranked as a low-middle income country. The Gross Domestic Product (GDP) of the country is 161 billion dollars (WB, dataset, 2009), and the Gross National Income per capita in 2009 was 1,020 dollars. (UNICEF, 2010). With a population of over 160 million (WB, 2009), 43 million people lives below the poverty line of dollar a day (FCO, 2011). Pakistan is the sixth most populous country in the world, with 38 percent of its total population under 15 years old (Leahy, 2007). The United Nations estimates that Pakistan’s population will increase by another 54 million people in the next 15 years. (UN, 2005).


Insaf Research Wing

With a steadily increasing youth population, Pakistan faces serious challenges in ensuring universal primary education. Literacy rate, which is based on the ability to write your name, is barely 50 percent (FCO, 2011). This is abysmal when compared to the literacy rate of the United States, which is at 99 percent. It is low even when compared to other countries in South Asia, where the average literacy rate among countries is 61 percent.

Within Pakistan, there are significant differences in education across the urban-rural, male-female and rich-poor divides. For instance, literacy rate which is 54 percent on the whole, drops to 35 percent for females. Pakistan is one of five world nations with the lowest literacy rates and among the twelve world nations that spend less than three percent of their Gross Domestic Product on education (Shah 2003; Kronstadt 2004; Farah 2007). There is a high dropout rate even for primary school students. The United States Agency for International Development states that of the two-thirds of Pakistani children (ages five to nine) who have ever enrolled in school, only one-third manage to complete primary education (fifth grade; Kronstadt 2004). 70 percent of these students are male and 53 percent are female. The Primary Gender Parity Index GPI ratio1 rests at 0.78 (World Bank 2008). While the literacy rate has steadily increased over the years for both subgroups of males and females, the gap between them still remains large. This is of immense significance for labor policy since lower education in women will lead to lower labor participation rates for females. Most women will thus continue to participate in informal markets, earning little income and unable to break the continuous cycle of poverty.

The quality of education provided in most areas is also low, and great disparity exists within the provinces and the urban-rural divide. Furthermore, the primary school completion rate in rural areas for females is three times lower than that for males. In urban areas this rate is twice as low (Herz and Sperling 2004). Surveys assessing the quality of education which were conducted between 2003 and 2007 under the Learning and Educational Achievement in Punjab Schools (LEAPS) show that students were performing well below their grade levels. By the end of the third grade, barely 50 percent of students had mastered the mathematics

1 The Gender Parity Index (GPI) is a socioeconomic index usually designed to measure the relative access to education of males and females. In its simplest form, it is calculated as the quotient of the number of females by the number of males enrolled in a given stage of education.

curriculum for the first grade (Andrabi 2008). This is an example of how the current education system is not only inaccessible to all children but also greatly lacks in quality.

Problem of access and equity

As explained previously, there are numerous disparities in the education system of Pakistan. The lack of access to education across different income and gender groups further exacerbates the problem. The overall literacy rate among the poor in Pakistan is 28 percent, while among the middle and upper-middle classes this rate jumps to 49%. The net enrollment rate is 37 percent for the poor as opposed to 59 percent for the middle and upper classes (World Bank 2002).

Enrolment remains the lowest in the poorest quintile, and the dropout rate is highest among this group. This is a troublesome fact, especially since 65 percent of the population of Pakistan lives below $2 a day (UNESCO 2006). With commitments to Millennium Development Goals (MDGs) and Education for All goals (EFA), extensive efforts will have to be made to provide equitable education access to this low-income group. A lack of education would mean that this group will continue to be employed in the lower wage informal sector, with little or no chances of career growth. This makes it hard for them to break the cycle of poverty and get a fair chance to improve their lives.The importance of a better-educated population grows significantly as Pakistan moves from an agrarian based to a service sector based economy. In 1999, 27 percent of the labor force was employed in agriculture, while 49 percent worked in the services sector. In 2009, the number of people employed in agriculture went down to 21.6 percent, and those employed in the service sector increased to 54.2 percent. This structural change means that traditional, brute force work, agricultural work is in gradual decline in Pakistan (Labor force survey, 2010).


The labor policy of Pakistan, 2010 addressed many important labor issues. The effectiveness of this labor policy will be discussed below. The 2010 labor policy was presented by the democratic government that came to power in 2009. Most of the features were the same as past labor policies but there were some notable differences. I will discuss the salient features of this policy that currently affect labor issues, especially women labor


Insaf Research Wing

participation, in Pakistan. The minimum wage in Pakistan has increased from Rs. 6000 (around $70) to Rs. 7000 (around $80). Although this is an increase in monetary wages, if we take into consideration the inflation rate of over 30 percent, it amounts to a fall in terms of real wages.

The policy also emphasized that it would regularize the informal workers (the majority of which are women) within the “shortest time possible”. It is interesting to notice that no time frame or actions were promised by the government on how it plans to regularize such workers.

Another salient feature of this labor policy was that “Matric-Tech” schemes were introduced in worker welfare schools. Schools which receive funding from the labor department are commonly known as worker welfare schools. In these schools free education is given to children of the laborers. In such schools, Matric-Tech schemes promote an education curriculum in which vocational training is provided along with the regular high school curriculum. This is done to provide vocation training to students, so that they may be better equipped for the labor market after school. Here, it is important to recognize that women are generally excluded from vocational training and once again no commitment came from the government to address this dire issue.

It is interesting to highlight that this labor policy is merely a list of recommendations and suggestions. There is no budget attached to it, and the government and other stakeholders are under no obligation to implement it as emphasized in the labor policy.

Female Labor Participation

Females have lesser access to education than their male counterparts. They also form a smaller amount of the labor force. According to International Labor Organization, in 2003-2004 the female labor participation rate in Pakistan was 11.2 percent. This section will explore in detail the reasons for low female labor participation. I will also be discussing various issues, both social and institutional that affect these participation rates.

Definition of female labor participation

As in most developing countries, measuring the extent of female labor force participation in Pakistan is sensitive to the definition of work used and the duration (a week, month, or year) considered. The measurement of male participation

in the labor force tends to be less affected by such issues. According to the Pakistan Integrated Household Survey, which measures work participation over a reference period that is longer than that used by the Labor Force Survey, 67 percent of males and 25 percent of females were participating in the labor force in 2001-2002. This includes both paid and unpaid (family labor) work. Women who participate are much more likely to do so in unpaid work, while men are more likely to participate in paid work. Almost 60 percent of women involved in the labor force are unpaid workers. This is a very high rate compared to that of men; among those who participate in the labor force, only 19 percent of men are unpaid family workers.

Rankings on International Indexes

Pakistan is a country that does not do well on international gender related indexes. It is ranked in the UNDP gender related index at 135 out of 174 countries. In terms of gender empowerment, Pakistan is ranked at 100 out of 102 countries. The ranking in gender empowerment is primarily a function of low female education and labor participation rates.

The Significance of Women’s Work

Research on women who perform paid work in Pakistan reveals that they work out of economic need. They face a hostile environment of limited employment options, unequal wages, bad work conditions, and an extra burden due to unremitting domestic responsibilities at home. This is true whether women perform agricultural wage labor in the rural areas or piece-rate work in the cities. Even those in the formal sector are not free from discrimination in the workplace and sexual harassment.

Pakistan is an Islamic country and many times religion is attributed as a reason for low female labor participation. I feel, however, that the low labor participation among females has more to do with cultural factors than with religion. A statistical comparison indicates the same hypothesis. Bangladesh, which is an Islamic country as well, has much higher female labor participation. As compared to the anemic labor force participation of 11.2 percent in Pakistan in 2003-2004(Labor Force Survey, 2004), Bangladesh had a female participation rate of 57.6 percent (International Labor Organization, 2000)


Insaf Research Wing

Table-1

Pakistan: Labour Force Participation Rate

2001-02 2003-04

Female 9.9 11.2

Male 48 48.7

Total 29.6 30.4

Source: Labour Force Survey 2003-04

Table-2

Bangladesh: Labour Force Participation Rate

1995 1996 2000

Female 67.8 57.2 57.6

Male 88.9 89.8 89.2

Total 78.6 73.7 73.8

Source: www.ilo.org

The reason women are less dominant in even formal high paying jobs is the cultural constraint that reinforces the traditional role of women as home makers. Women usually work full time in their homes, but this is not recorded in the labor market statistics. The low female labor participation acts as a disincentive to invest in women’s education. Parents who lack resources prefer to invest in a male child’s education over a female’s education, since he can participate in the labor market while she might not be able to. Women who do work before marriage are sometimes barred from the workplace by their husband’s families. This adds another element of uncertainty that discourages employees from making any significant investments on women. The cause and effect relationship between female education and labor market participation is strong. Severing this link will be hard for the government but it is very important to break this perpetuating cycle that discriminates against women.

Factors That Determine What Kind of Work Women Do

There are various factors that influence a woman’s choice of occupation in Pakistan. Shahnaz Kazi(1999) researched the gender equities in Pakistan and explains that multiple constraints

circumscribe women’s work options. The following constraints are most common.• Social norms regarding suitability of particular

occupations in eyes of family members and employers

• Work in non-farm sectors further away and in nearby urban centers is not acceptable as it is perceived to be not compatible with domestic duties

• Gendered work patterns keep women in low-paying, low-status activities.

• Restricted job options and low returns inhibit parental motivation to invest in their education, particularly where resources are limited. (Kazi 1999: 387-88, 410)

Formal sector

The society in Pakistan is male dominated and patriarchal. The culture is against working women who are viewed negatively by a large portion of society. Women, who work in the formal sector, face harassment of various forms at the work place. Harassment at the workplace is not recognized as a punishable offence in Pakistan. A bill is pending at the legislature which will make it a punishable offense, with jail time of up to 3 months. Lack of awareness about harassment and the fear of retaliation from co-workers and supervisors force women to let many cases go unreported.

Data on the number of women affected by harassment is hard to come by since there is no law under which cases can be registered. This means that estimates are anecdotal at best. "I see about 50 to 70 women per year," says Ambreen Ajaib, who has been working for three years as a psychologist for victims of harassment at Bedari, a women's rights NGO.

However, even she admits that such numbers may not reveal the actual situation since many women are not willing to admit being targeted. "It's difficult to get exact figures because few women have access to us and because many women believe that the fault lies with them -- that a woman normally lures the man and that if she is dressed a certain way she will be harassed and so on. Any woman who reports harassment always mentions what she was wearing." A woman’s sense of self is determined by societal rules, which are perceived to endanger her family’s reputation. This reflects how the culture and the society are reinforcing gender discrimination, reducing opportunities for women to participate in the labor market, and placing them in precarious and vulnerable positions.


Insaf Research Wing

In the formal sector based in the urban areas, there is an overwhelming concentration of women in certain sectors. Women tend to be concentrated in the “respectable lines of teaching and medicine”. These norms emphasize on “the low social status of sales and secretarial jobs that involve contact with men at a personal level.” (Kazi 1999: 391). This means that women who do not have the professional training to be a doctor or a teacher end up in the informal sectors in home based earning activities (409).

Women’s Employment Organizations and Trade Unions

There are over seven thousand registered trade unions in Pakistan. The total male membership of reporting unions was around 245,400, while female membership was no more than 2,134 in 2002. Among registered trade unions, membership above ten thousand is only limited to the industries of textile/hosiery, post/telecommunications, and chemicals/dyes (Federal Bureau of Statistics 2005a: 255-6).

There are currently trade unions in major government organizations, such as the airlines, railways, post office, education institutions, hospitals, water and the power development authority. They all employ women, yet women do not have significant membership or decision-making powers in these unions. At a recent meeting with government, civil society and labor stake-holders, one of the major recommendations by the female labor activists was to increase the number of women workers in the industry. This would ultimately lead to an increased number of women in trade unions, and to that end a specific quota was proposed for women in each industry as well as in trade unions. Another recommendation that was made called for trade unions to include a specific clause in their constitutions to allow women key leadership positions, and to provide an independent section for women to discuss their issues. (Ministry of Labour et al 2005: 26-7).

The National Commission of Status of Women survey of home-based workers in Pakistan finds that although the majority of women say they are satisfied with their work conditions, the leading causes for dissatisfaction are related to low earnings and low rates in the market. When asked what kind of legal cover they would like to have, to

improve their work conditions, 30 percent voted for home-based workers’ unions (40 percent voted for a loan facility) and 65percent said they would be willing to make contributions for their benefit to a social security organization.

Difference between gender on wages, industry participating

The table below is taken from the Pakistan Labor Force survey of various years. It shows that women’s share in industry has grown by 3.8 percent between 2000 and 2008. Their share in agriculture, however, has grown by a mere 0.1 percent whereas their share in the service sector has fallen by 3.9 percent. Women’s share in the labor force is the highest in the agriculture sector.

Table-3 Federal Bureau of Statistics, Labor force Survey, Multiple years

Economic Policy Reforms

In Siddiqui’s (2006: 3-4) study on women workers, and the effects of stabilization and structural adjustment programs in Pakistan, various findings come to light:

• The country has experienced a slower growth rate of output, declining employment, and a rise in poverty.

• Expansion of female employment in the manufacturing sector is taking place outside the regular factory workforce, and is mainly in the form of temporary and contract workers. This reflects the low absorptive capacity of the large scale industrial sector, and also indicates a deliberate policy by employers to exploit


Insaf Research Wing

female workers as a cheaper and more pliable form of labor.

• Female workers are concentrated in a few occupations and industrial groups, and this depresses their wages. They have low skills and less mobility, hence they have not increased their participation in the modern highly productive sector of the economy.

In rural areas, more women work than their urban counterparts, but the work is in agricultural lands and is often poorly paid or paid in the form ofagricultural produce. Figure 1 is also taken from various labor force surveys across the years and reveals that over time the gender gap in labor participation is decreasing in rural and increasing in urban areas.

The findings suggest that the sectors which employ females are poorly paid, temporary, or involve contract based work with little chance of career progression.

Figure-1 Federal Bureau of Statistics, Labor forceSurvey, Multiple years

Wage gaps between gender

The discussion so far has identified various problems women face when they enter the labor market. This section will discuss the varying wage gaps among genders. The following Figure 2 shows that the wage gap between males and females continues to increase. Women, on average, earn 38 percent less than their male counterparts.

Many people argue that this gap is due to males having more skills and education than females. The next figure refutes that claim. It shows the average real wage of the employees by aggregated major occupational groups.

Figure-2 Federal Bureau of Statistics, Labor force Survey, Multiple years

Figure 3 (next page) suggests that across all skill levels, females earn substantially less than males. The most striking comparison can be found between highly skilled males and females. A highly skilled female was being paid as much as a skilled or unskilled male would earn. This discrimination occurs across all levels of skills.

Figure 4 (next page) shows the gender gap across various dimensions. Women have a low labor participation rate, a low employment to population ratio, a low share in non agricultural employment, a low share in wage and salaried employment, and a higher share in vulnerable employment. Women across all these

dimensions are at a vulnerable position.


Insaf Research Wing

Figure-3 Federal Bureau of Statistics, Labor force Survey, Multiple years

Figure-4 International Labor Organization, 2009


Insaf Research Wing

According to the World Bank’s World Development Report 2000/01, closing the gender gap in schooling would have significantly increased, and sometimes more than doubled economic growth in sub-Saharan Africa (SSA), South Asia (SA), and the Middle East and North Africa (MENA). Despite international declarations on gender equality, as, for example, in the Millennium Development Goals2, only a few countries have actually achieved gender equality in primary and secondary education. The differences are even more pronounced in higher education. In South Asia and sub-Saharan Africa, for example, girls only make up a third of the number of students in tertiary education.

Equally alarming are labor-market indicators, which clearly highlight that countries do not adequately use their available human resources, in particular those of the female population. In many developing countries, women’s economic activities are marginalized to the informal sector, small-scale farming and/or domestic work. Cases in point are South Asia and the Middle East and North Africa: in both regions, only around 20 percent of all wage employment outside agriculture is held by women.3

Vocational training of women

Vocational training available to women is limited in Pakistan4. The government does not have a large enough budget to cover vocational training for all women. Various national and international NGOs are experimenting with various models to provide this training to women. Most of the NGOs teach skills such as embroidery, stitching, embellishment, etc. This model builds a centre near a rural village and equips it with basic tools such as sewing machines. Women trainers then teach the local women the skills required to start production. Those trained can then choose to work from home or from the centre. Such centers also build relationships with boutiques, exporters of handicrafts and others outlets. In this way, they can provide the local women with continuous demand of their product. The advantage of this model is that it requires low capital and is easy to replicate. It is also sustainable as women soon start learning from each other. The downside of this model,

2 MDGs or millennium Development goals are by the United Nations that member countries have committed to achieve3 http://www.voxeu.org/index.php?q=node/970

4 Interview with Kamilah Shahid, Khidmat Foundation

however, is that women remain tied to these low paying jobs, relentlessly working on completing product orders, often with no career mobility.

The sections above have explained vital labor issues related to gender. Before I move on to the recommendation, I would like to mention a few encouraging facts about the status of women in Pakistan.

There is a steadily increasing representation of women at the legislature. The quota for women seats currently stands at 33%. This will serve as a platform to introduce reforms that will positively affect women. There has also been a rise in women NGOs that are actively fighting for laws against harassment, discrimination and employment. This indicates that advocacy of such issues has increased substantially in Pakistan over the past few years.

Recommendations

My recommendations in this section propose institutional changes, increase in education and an increase in women entrepreneurship, if implemented correctly, could transform labor policy in Pakistan.

Changing social institutions is cumbersome, but still possible

A lot of countries are committed to change the institutional frameworks that limit women’s employment and skills. These efforts are having the positive results. For example in Tunisia, 30-50 percent of judges, physicians and schoolteachers are now women. Similarly in India, women have risen to the highest levels of politics and business in recent years. However, these are relatively rare cases, and such changes still face dire resistance. For example in India, still women are being murdered over disputes about dowries.

In order to strengthen reforms, many development experts have called for more funding - for instance, to build more schools. This has to be accompanied by a strong advocacy campaign to promote education and by addressing the fundamental causes of discrimination and low incentives for education. Extra spending, while badly needed, will generate real returns only if the fundamental causes of discrimination are also addressed.

That may mean institutional and legal reforms as well as better enforcement of existing laws. The harassment at work law should be introduced with


Insaf Research Wing

dire penalties. This will provide women with the sense of security at workplace and reduce the social disapproval of working women.

Many countries are willing to change, and most have signed the 1979 UN Convention on the Elimination of All Forms of Discrimination against Women and, more recently in 2000, the UN millennium goal of empowering women and combating discrimination. Helping countries improve gender equality is therefore not only important to the government for increased growthbut it is an international commitment as well. While assistance of international organizations is encouraged, lasting change has to be come from within communities themselves.

Address the Education needs of women

The Government of Pakistan5 should spend more on education

Currently, the government of Pakistan is spending about 2 percent of the GNP on education. This is insufficient, given the educational needs of the country. The government must commit to allocate a higher percentage to the education sector, and to proportionally allocate this to various sub-sectors of education, especially women’s education. The new National Education Policy of 2009 has made strong commitments and policy recommendations for such steps. Immediate implementation of these will help Pakistan get closer to achieving the Education For All goals and Millennium Development Goals. A recent analysis of budget and public sector expenditure on education has revealed that spending on education has actually declined during 2007-2009, which is a matter of great concern.

The government and the international NGOs should collaborate to build more schools and train more teachers

The government of Pakistan needs to take pragmatic steps to ensure a sufficient number of schools for both males and females, and a sufficient number of trained teachers (again, both male and female), especially in rural areas. Ensuring an adequate number of teachers requires increasing 5 In Pakistan only the federal government has the authority to tax its citizen hence an active role of federal government is emphasized in all these recommendations. In Pakistan there is no local or school taxes and the revenue is distributed by the federal government.

salaries, formalizing standard contracts for teachers, and guaranteeing the provision of transport and day care centers for female teachers. Incentives can be offered to teachers locating to a rural school in form of a better salary and a safe and improved environment.

Make primary education free and compulsory for both male and female students

If education were free and compulsory, more parents would send their girls to school. The government should ensure that not only are school fees covered, but that girls from low income families receive free text books, uniforms, transportation and daily lunch. This strategy has been successful in other countries in the region. For example, the people of Sri Lanka have been enjoying free education for the last 50 years. As a result, Sri Lanka has seen remarkable advancements in human development, in spite of internal conflicts and political upheavals. Also, the government should introduce flexible school timings and region-specific school calendars in order to cater to children who work to supplement their family income. This should specifically apply to girls who are engaged in household or farm work during typical school hours.

The government should improve advocacy and outreach to promote female education

To win supporters, the government should conduct a campaign on television and radio to highlight the importance of education for both girls and boys, and should encourage parents to send their children, especially girls, to school. Such advocacy can help address and change the cultural norms and the traditional mindset that many people have. Under the devolution plan of 2002, citizen community boards are formed to monitor community progress. Such boards are elected and can also be assigned the task to improve advocacy and outreach campaign to increase women participation in education.

Establish an independent monitoring and evaluation mechanism to oversee education delivery

A monitoring and evaluation mechanism should be established for the elimination of corrupt elements and practices from the education system.The


Insaf Research Wing

District Community Office (DCO) should be assigned responsibility to monitor quality and infrastructure of schools. A separate monitoring cell should be placed under the Ministry of Education to periodically monitor public schools. This will help make non-functional schools to function efficiently, particularly in remote, rural areas of the country.

The recommendations above address both the demand and supply side. The supply side strategy is to focus on the availability of schools and female teachers, whereas the demand side considers various initiatives to increase demand.

Develop Entrepreneurial Opportunities for Women

Promotion of Small Medium Enterprises

There are a small number of federal and provincial institutions working specifically for the development of SMEs. These institutions usually do not reach out to women entrepreneurs; their operations are normally targeted at businessmen, especially since business is generally considered a male domain in Pakistan. SMEDA or small medium enterprise development agency, a federal institution dedicated to providing enterprise development services, should undertake research that identifies gaps and distortions in existing services that could be rectified in future operations. SMEDA should also be given grant money by the federal government to assist women in setting up small and medium sized businesses.

The International Donor agencies can create Entrepreneurship development programs for potential women entrepreneurs

A multilateral arrangement should be formed which includes the International Labor Organization as a consultant, a donor agency such as the Asian Development Bank for funding, and Pakistani government institutions as executing agencies to introduce entrepreneurial vocational training to women..The probability of doing business increases significantly for Pakistani women if they have acquired formal education. At present, however, there are very few women entrepreneurs in the labor market who possess such education. A pilot project can be launched for a selected group of 25 businesswomen in each of the four provinces of Pakistan. This program would prepare a new group

of successful women entrepreneurs to serve as role models for the next generations.

Establishing/strengthening women’s business forum

The small numbers of women’s business forums that exist in Pakistan have extremely limited outreach and offer few quality services. They do not exist as institutions but as personalities: they have limited membership and confined regional outreach. This explains why no such business forum has emerged as a national lobby group for women entrepreneurs. Currently there is an urgent need to assist self-sustaining institutions, and to associate them with the regional Chambers of Commerce and the Employers’ Federation of Pakistan and other national forums.

The public banks in Pakistan and the financial NGOs should develop and enhance Microfinance institutions

Micro financing is increasingly seen as a way to empower women in developing countries by the international organizations. After the success of Grameen Bank in Bangladesh, many countries have experimented with the model. One such organization that is working in Pakistan is called KASHF. Its goal is to empower women by providing financial assistance to them. Such organizations can make a great difference in the lives of women, but they need to have an effective follow-up strategy on their clients, and strong accountability to ensure that the funds are used to assist businesses and investments, rather than being used on operational expenses. Currently, KASHF is only working in one province of Pakistan (Punjab). This model can be adopted by the public banks and other financial NGOs to remove the roadblock of limited finance out of the way for women. The loans can have other preconditions attached to them as well. For instance, such loans will only be given to women or they must enroll their female children in schools in order to qualify for such loans. The provision of loans can create an incentive to achieve positive social results.

Conclusion

This paper presents the background to the gender issues that are present in the Pakistani society and how they impact the labor market in the country. Needless to say, the government of Pakistan needs to end disparities and discrimination, and form a national agenda to assist women participation in the


Insaf Research Wing

labor market. A strong commitment is required from the government and the international donors to change the social structure of gender discrimination in the labor force. The recommendations mentioned above are not exhaustive but they are important guidelines for the formation of a labor policy that will end discrimination and encourage labor participation for women.


Insaf Research Wing

Bibliography

Abbas, N. "Sexual Harassment inPakistan." Huffington Post 2009. Print.

Kazi, Shahnaz. "Gender Inequalities and Development in Pakistan." 50 Years of Pakistan’s Economy: Traditional Topics and Contemporary Concerns. Karachi: Oxford UP, 199. 376-414. Print.

Khan, Ayesha. "Women and the Pakistan Government: A Brief Policy History (1975-1998)." Gender Unit, UNDP, 1998. Web.

Khan, Shujaat Ali. "Karachi: SHC Moved against Ban on Teachers’ Union." Dawn 2006. Print.

"Labour Force Survey 1999-2000." ILO. 2000. Web.

"Labour Force Survey 2000-2002." ILO. 2002. Web.

Ministry of Health. Government of Pakistan. Web. <www.phc.gov.pk>.

Ministry of Labour (Government of Pakistan), International Labour Organization, and Canadian International Development Agency. Report on National Tripartite Stakeholders Consultation on Women Employment Concerns and Working Conditions. Islamabad: (WEC-PK) Project, 2005. Print.

Ministry of States and Frontier Regions (SAFFRON), Population Census Organization, and United Nations High Commissioner for Refugees (UNHCR). Census of Afghans in Pakistan 2005. Islamabad, 2005. Print.

National Commission on the Status of Women, and Pakistan Manpower Institute (Labour Manpower and Overseas Pakistanis Division). National Survey Report on Home-based Women Workers in Pakistan. Islamabad, 2005. Print.

Pakistan. Alliance Against Sexual Harassment at the Workplace. Situational Analysis on Sexual Harassment at the Work Place. Lahore, 2002. Print.

"Pakistan Employment Trend for Women." ILO. Web. 209.Pakistan. Federal Bureau of Statistics. Compendium of Gender Statistics in Pakistan, Based on 2004 Data. 2005. Print.

Pakistan. Federal Bureau of Statistics. Statistical Yearbook 2005. 2005. Print.

Pakistan. Finance Division (Economic Advisors Wing). Economic Survey 1994-95. 1995. Print.

Pakistan. Finance Division (Economic Advisors Wing). Economic Survey 2005-06. 2006. Print.

Pakistan. Finance Division (Economic Advisors Wing). Economic Survey, Statistical Supplement 1999-2000. 2000. Print.

Pakistan. Finance Division (Ministry of Finance). Economic Survey, Statistical Supplement 1986-87. 1987. Print.

Pakistan Institute of Development Economics. How Do Women Decide to Work in Pakistan? By Zareen Naqvi and Shahnaz Lubna. Islamabad, 2002. Print.

Pakistan. Ministry of Women Development. Pakistan National Report: Beijing +10. 2005. Print.

Pakistan. Ministry Women Development. National Plan of Action. 2006. Print.

Pakistan. Pakistan Economic Survey 2003-2004. 2004. Print.

World Bank. Pakistan Country Gender Assessment 2005: Bridging the Gender Gap - Opportunities and Challenges. Washington, DC, 2005. Print.

About the Author

Amna Khan holds her Masters in Social and Economic Policy from University of Texas at Austin. She is a researcher and a consultant.Currently, she is teaching at a private university.

e-mail: [email protected]

labor policy in pakistan

Education

irw onlythen

published reports of

government of pakistan

people of pakistan

prior permission of

foremost goal of irw

research reportspapers

insaf research wingpage