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More females [than males] suggest they don’t have money for education: Sanisha Packirisamy – Momentum Investments.
SIMON BROWN: I’m chatting with Sanisha Packirisamy, an economist at Momentum Investments. Sanisha, I appreciate the time today. A slightly different topic from what we usually talk about – female participation in the economy.
Research from the IMF [International Monetary Fund] shows a fairly clear link between a country’s productivity growth and efforts to bolster female participation in the labour force. SANISHA PACKIRISAMY: Thank you so much, Simon. Yes. In celebration now of Women’s Month – which we had in August – I decided to have a look at the impact of increasing female labour-force participation, particularly in your emerging market world, where you find that a lot of females who are employed tend to be employed in your lower-earning and lower-skills sectors of the economy. On the back of this report from the International Monetary Fund back in 2018, they basically just explored the economic rewards that are tied to gender inclusion. What they did find is that these barriers to entry for women in the labour market are in fact a lot pricier than they initially perceived. If we manage to actually close these gender gaps we can yield a far more positive effect on growth and overall welfare for societies across the globe. SIMON BROWN: Obviously there’s a lot I’m thinking of: spaza shops, informal [businesses]. Would this mostly be formal employment? Or perhaps maybe a better way of putting it is ‘paid employment’. SANISHA PACKIRISAMY: Some of these measures do in fact look at paid employment and in fact look at your more formalised sectors of the market. What they’ve defined as the labour force is essentially the number of working-age females who are directly in employment or actively seeking employment. The surveys that we’ve conducted for South Africa that come from Statistics South Africa basically look at your quarterly labour-force survey numbers – and those tend to include some of your workers in the agricultural space, which are then captured as part of your informal labour force. But, as we know, across the globe, including South Africa, we don’t really have a very firm grip on the quantum of workers in the informal labour space. SIMON BROWN: That’s a fair point. Absolutely. How does South Africa fare in terms of participation in the labour force? SANISHA PACKIRISAMY: I’ll say it’s a bit twofold because, firstly, South Africa’s female labour force participation rate is at about 54%. That is in fact better than the global average which sits at about 47%. However, if you compare it to male participation there is still quite a significant gap of about 11%-and-a-bit. Now, some of that gap has actually narrowed. That 11%-and-a-bit used to be over 15% at the time of the global financial crisis, but unfortunately that gap didn’t narrow because we had more females coming into the labour force. It narrowed because we had fewer males coming into the labour force over that period of time. SIMON BROWN: Can policy help? For example, some governments, including our own, have participation rates within parliament, within councils [where] 50% must be female. Can policy drive this or is it more corporate? SANISHA PACKIRISAMY: Definitely policies can make a very big effort in trying to close that gender-disparity gap, and we’ve seen this playing out globally. One of the countries that I looked at was Malta. If we look at Malta’s labour force participation for females, they basically started off at 34% [for] women who were actively part of the labour force back in 2004. And 2004 is significant for Malta because that’s when they joined the European Union. But then by 2020 Malta’s female labour force participation rate actually outpaced that of the European Union. It got to about 67% and since then it has continued to climb. It’s now over 70%, almost closing in on 75%. A big portion of this transformation came through from a rise in foreign female workers. So that has to do with policy again. But we also saw that they announced things like free childcare, there were huge media campaigns trying to reduce the traditional norms of gender in the labour force market, they also introduced more parental leave, some more flexitime and other empowerment initiatives. Those all allowed women to re-enter the labour force. Of course, this was for Malta, and that is centred in the European Union. We’d also have to look at different policies in our own labour market in South Africa, given that we have some different dynamics playing out in South Africa. SIMON BROWN: And the logic here, I would imagine, is quite simple. Women in the labour force – this obviously helps with households, helps with individuals, perhaps single parents or unattached woman, but also just increases general productivity. You’ve more people working in an economy rather than many not, or perhaps it’s free labour in terms of looking after the home and the children. SANISHA PACKIRISAMY: Most definitely. So if you look at the working conditions, and yes, I’ve looked at the working conditions faced by males and females in the South African labour market, again using data from statistics South Africa we didn’t find many differences in terms of those who were employed on a temporary versus permanent basis between males and females, those who had a written contract in place, and those who contribute to things like the Unemployment Insurance Fund. But there was quite a big difference in terms of the amount of time that females actually spend per day doing household work and family care than males do. We also saw some information coming through from the World Economic Forum on this, where females on average in South Africa spend nearly three times more hours per day on doing these household chores relative to their male counterparts. And that of course has, you know, a big influence on the ability of women to fully participate in the labour market. SIMON BROWN: And that’s where corporates can really come in. You talked around childcare. Females are usually the primary caregivers. They need their childcare, they need flexitime, parental leave. You’ve almost got to look at it with a different lens and make it accessible. SANISHA PACKIRISAMY: Most definitely. I think the private sector does have a significant role to play in this in terms of expanding childcare, care for the elderly, including more females into credit access in the labour market, trying to eradicate gender-based violence from a public as well as a private-sector perspective. But I also think that government has a role to play in terms of equal investment in skills and in education. A lot of this actually already starts off at the school level. And so again, based on that survey from Statistics South Africa, they looked at the top four reasons for males and females not attending an educational institution. It was quite striking that over a quarter of males said that those who don’t attend a school between the ages of seven and 18 don’t attend because of poor academic performance. That was much lower at about 17% for females. Now, even though females did better in terms of their schooling capabilities than males, more females suggested that they were not attending an educational institution because they didn’t have money for fees. That was close to 23% of those within the age group of seven to 18 that were not in attendance of an educational institution, unable to do so because there was just no money to fund the education. I think this is really the fundamental problem coming through from the unequal investment that we see in skills and education at a young level already – and that of course then permeates through the evolution into the labour market. SIMON BROWN: Yes, I take your point on that. Education is the absolute cornerstone. So when you turn 18, you’ve got that background. We’ll leave it there. Sanisha Pakirisamy, economist at Momentum Investments, I always appreciate the insights.
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