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Gender gap, sexual harassment, and economic retardation

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Discrimination in employment and in workplaces under any labeling is a degradation of human spirits and capabilities to pursue activities for self-actualisations and societal cause and effect. Discriminatory environment results in economic retardation -- a situation in which an economy progresses with drags or crawls -- plain and simple (A case study in economic retardation by Jörn Svensson in Economy and History, published online: May 23, 2021).

Bangladesh scored 72.2 per cent and ranked 59th globally in terms of gender parity in the health and education sector (2023 World Economic Forum; WFE). What about women’s participation in other sectors – manufacturing and agriculture and retail businesses?

In recent years more and more women are joining the labour force aspiring to gain financial independence and self-empowerment. However, many studies blamed the presence of Sexual Harassment Environment (SHE) in workplaces as disincentives to work in many formal sectors of the economy. Even then women’s participation in both public and private sectors has continued, albeit at a slower pace. Unfortunately, the Bangladesh government doesn’t have any explicit policies addressing the issues relating to SHE or identifying behaviours that may constitute sexual harassment. Section 509 of the Penal Code 1860 states, “words, and gestures intended to outrage the modesty of the woman are subjected to punishment with a prison sentence that may extend to one year along with fines”. There is little or no data confirming the implementation of this code of conduct.

SHE does not prevail only in workplaces – the perpetrators or harassers are pervasive, lay in wait, walk alongside on roads, shopping malls, join bus rides, and so on. Any nuances of facial expressions or body language or any caricature by peer workers or supervisors that may manifest or constitute harassment and derogatory -- directly or indirectly -- must be dissented with zero tolerance. Public shaming as often played regularly in Bangla Natok (dramas) is a significant deterrent against innuendos – such as libelling or demeaning remarks. 

According to a recent International Monetary Fund (IMF) report only 47 per cent of women are active participants in global labour markets vs 72 per cent of men. Such gaps are more common in emerging and developing economies. IMF study argues that narrowing this gap by 5.9 per cent through improving SHE could help many of these economies grow by nearly 8 per cent.

In addition to pervasive presence of SHE outside home, there are several long-known constraints women confront around the world to enter workforce in formal economies. These include lack of access to education, skills, credit, land, legal services, and care services, among others. The IMF estimate shows that low income developing economies would gain 7.1 per cent growth vs 5.4 per cent in advanced economies since the latter made cheering progress in curbing the SHE. Such a hefty growth prospects -- if realised by implementing appropriate policies -- would eliminate the economic losses perpetrated by the COVID-19 pandemic. Country-specific policymakers are urged to analyse IMF’s gender gap closing strategy to open up the employment opportunities for women. The 2023 WEF Global Gender Gap predicts that at the current pace of progress, it will take an average of 131(+,-) years to fully close the gap.

It is now widely recognised that presence of SHE in workplaces has significant adverse psychological impact on workers by fermenting personal feelings of self-degradation, which results in productivity loss and the victims may potentially face the eventual risk of being fired from jobs. Firms where SHE is reported to exist also suffer considerably in value and public image. In a recent article entitled, “How Much Does Workplace Sexual Harassment Hurt Firm Value?” in the Journal of Business Ethics (February 2, 2023), Shiu-Yik Au, Ming Dong & Andréanne Tremblay, found that firms tolerating SHE suffer substantial declines in future stock performance and profitability. For example, firms with a top 2 per cent SHE scores earn a value-weighted risk-adjusted stock return of ? 17 per cent in the 1-year period after high-SHE classification, and this damage is concentrated in firms with higher investor attention. Furthermore, high-SHE firms experience a decline in operating profitability and an increase in labour costs during a 5-year period around.

A recent Labour Force Survey (LFS, 2022) in Bangladesh reported that out of a total 800,000 graduates, 336,000 unemployed were women. The survey estimated women unemployment at 19 per cent last year vs 12 per cent among people with tertiary level education. More and more women with HSC certificates have been participating in rural agriculture-centric activities. Unfortunately, favourable job opportunities in urban areas are becoming few and far between and highly competitive. With women graduates coming out of colleges and universities every year, sociological factors and lack of gender-neutral conducive work environment are discouraging many from seeking and getting jobs in service and formal sectors (example: extractive industry, manufacturing, and provisions of services, are typically part of the formal economy).

Let us depict the state of the Bangladesh economy considering vis-a-vis SHE driven unemployment as narrated above within the perspectives of the well known hypothetical Production Possibilities Frontier (PPF). The solid concave curve shows the potential output a country could produce at any point along the solid line provided all available resources are fully and efficiently employed. Let us assume that the solid curve represents Bangladesh economy’s 2022 potential GDP of $460.20 billion. This is the country’s highest GDP ever -- an increase of 10.55 per cent from its 2021 level of $416.33billion.

Every year a country expects its potential GDP to expand as new workers enter the labour force and new capital equipment and technology are added to the production function. As a result, the PPF shifts outward. The PPF would shift inward (shrink, as depicted in the figure) only if some of the resources are permanently lost or become incapacitated to have any productive use ever. A case in point is productivity loss in SHE firms, or qualified workers are discouraged to join the labour force. 

A country may produce at any point inside its PPF if all available resources are not fully and efficiently employed (i.e., some resources are lying idle and being wasted). The economy would slide into a recession while the potential to produce at any point along the solid PPF remains intact. Unfortunately, if unemployed resources are not taped back to production soon, they will lose their productive potential (depreciation) and PPF may then shrink (shift inward) permanently unless depreciated resources are replenished with the addition of new resources. Understanding the underlying concepts implied by the PPF is a prerequisite to understanding economic growth and recessions.

An array of obstacles -- which male graduates rarely face -- stand in the way of women graduates, such as family pressure to quit jobs after marriage or after having children, lack of childcare facilities at workplaces, lack of a safe public transport, and above all, conducive SHE-free campus, corridors, and corners. Absence of these facilitating desirables often creates a bias among employers against potential female employees, further heightening the problem. However, recent advances in technology are ushering in refreshing hopes.

There is persuasive evidence that progress in technology in advanced economies is slowly weakening the gender gaps in contrast to the past opposite role played by technology. “If technology today is more complementary to brain, in the past, it could have been more complementary to brawn”.

The next question: what contributions globalisation have made in narrowing the gender gaps? Trade theory advances the notion that if global capital flows open job opportunities for women, their bargaining power strengthens and households trade off child quantity by child quality. Fertility falls, human capital accumulates, and long-run per capita GDP would rise. If, on the other hand, globalisation facilitates job prospects for men, their intra-household power increases; fertility increases, human capital decreases, and steady-state income per capita would be low.  In their literature survey Silva & Klasen found that “inequality emerges as a rational best response to some underlying gender gap in endowments or constraints. As the underlying gap becomes less relevant -- for example, due to skill-biased technological change, -- men passively relinquish their power.” Though, in every culture as tradition of male chauvinism would have it, it is more likely for men to actively resist losing power and resources to women.  

Muzahida Tasbiha, Graduate Teaching Fellow at Asia University for Women, Chittagong.

[email protected].

Dr. Abdullah A. Dewan, formerly a physicist and nuclear engineer at BAEC, is professor of economics at Eastern Michigan University.
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