Stagnation of female labour participation

女性劳动力停滞
夏伟文(Har Wai Mun) & 赵梅伊(Tiew Mei Yi) (17th Feb 2014)

In July 2010, United Nations Entity for Gender Equality and the Empowerment of Women (UN Women) is created. This is another milestone in current trend to empower women for gender equality. Non-governmental organizations (NGOs) that promote women’s rights are aplenty in both developed and developing countries including Malaysia. However, are women and men equal? Can women and men have equal role in the economy? Until now, these two questions have been discussed but not yet agreed upon any conclusive answer. Let’s begin reviewing it with some interesting statistics and trend findings.

Statistics and Trends

Various data on Malaysia and international employment are collected from World Bank’s database. Equivalent data by Malaysian states are sourced from Statistical Department of Malaysia. Analyzing these data through three categories, namely (a) labor participation, (b) education, and (c) unemployment reveal some interesting (or alarming) trends.

Labor participation

In term of labor participation rate in Malaysia, female rate is lower than male rate since 1990 (earliest data available date, see Figure 1). The highest different between these two labor participation rates is 39.5 percentage-points in 1998. However, encouraging sign is that the different is narrowing since 1998 to 33.1 percentage-points recorded in the latest year 2011, mainly due to declining of male labor participation rate (not shown in graph). For the period between 1990 and 2011, average rate for female labor participation is 43.5% while male is 80.2%.

We selected 22 countries randomly (and because of data availability) to do international comparative study. Malaysia’s female labor participation rate on average is lower than developed countries like United States (58%), Australia (55.1%), United Kingdom (53.9%), Singapore (52.8%), Germany (49.5%), Japan (49.5%) and South Korea (48.8%) as well as developing ASEAN neighbors of Thailand (66.2%), Indonesia (50.2%) and Philippines (49.4%) (see Table 1). Iceland even achieved an average female labor participation rate at 70.2%, which is an astonishing 26.7 percentage-point room for improvement for Malaysia.

Malaysian states that have highest female labor participation rate in 2010 (latest available data from Statistical Department of Malaysia) are Penang, Kuala Lumpur, Selangor and Sarawak. Meanwhile, states with relatively lowest rate are Kelantan, Kedah, Terengganu, Perak and Perlis. Coincidently or not, states with highest rate also recorded relatively higher GDP per capita and vice versa. These are shown in Table 2 and Figure 2 (top).

Figure 1: Malaysia's Labor Participation Rate

 

(Data source: World Bank database)

Table 1: International Comparison: Labor (Female) participation rate

No	Country	Average 1990 - 2011	2011
1	Iceland	70.2	70.8
2	Thailand	66.2	63.8
3	United States	58.0	57.5
4	New Zealand	57.7	61.6
5	Australia	55.1	58.8
6	Russian	55.0	56.3
7	United Kingdom	53.9	55.6
8	Italy	35.9	37.9
9	Portugal	53.1	56.5
10	Singapore	52.8	56.5
11	Netherlands	52.5	58.3
12	Indonesia	50.2	51.2
13	Hong Kong	49.6	51.0
14	Germany	49.5	53.0
15	Japan	49.5	49.4
16	Philippines	49.4	49.7
17	Korea, Rep	48.8	49.2
18	MALAYSIA	43.5	43.8
19	South Africa	42.1	44.0
20	Spain	41.8	51.6
21	Greece	39.8	44.8
22	Mexico	39.2	44.3

(Data source: World Bank database, blue=Asian, green=European, orange=others)

Scatter chart in Figure 2 (bottom), shows a positive relationship between female labor participation and GDP per capita. The linear trend line is slopping upwards. This implies that increase in female participation in the economy will help increase GDP per capita. However, do our policies and Economic Transformation Programs (ETP) put enough efforts to increase direct involvement of women in our economy?

Table 2: Top & Bottom States

Top States	Labor force participation rate (Female), 2010	GDP per Capita for year 2010 at Current Prices
Penang	56.2 (1st)	33456 (2nd)
KL	54.3 (2nd)	55951 (1st)
Selangor	52.2 (3rd)	31363 (4th)
Sarawak	50.0 (4th)	33307 (3rd)
Bottom States
Kelantan	41.7 (10th)	8273 (14th)
Kedah	41.3 (11th)	13294 (13th)
Terengganu	40.6 (12th)	19225 (10th)
Perak	40.2 (13th)	16088 (11th)
Perlis	34.8 (14th)	15296 (12th)

(Data source: Malaysia’s Statistical Department)

Figure 2: Malaysia's Labor (Female) Participation Rate & GDP per capita, 2010

 

(Source: Malaysia’s Statistical Department; GDP at current prices)

Education

Ratio of female to male tertiary education enrollment has never declined less than 100 levels since 1990 (see Figure 3). This implies that female enrollment in tertiary education has always been more than male. In term of secondary education, female to male ratio dropped below 100 level since 2007 but still hold above 97 levels. Therefore, female labor participation rate of never more than 50% as compare to male labor participation average rate of 80% has been shocking. Female labors have been just slightly more than half of male labors as indicated by the bar chart of “ratio of female to male labor participation rate” in Figure 3. These statistics shows that women do get equality (if not better) education opportunity relative than male. The mystery is why they participation in labor market is relatively so low?

Figure 3: Female-to-Male Ratio: Labor Force & Education 

(Source: World Bank)

Unemployment

Average female unemployment rate from 1990 to 2010 is 3.8% as compared to 3.3% for male. Female unemployment throughout that period is always higher than male except for year 1999 and 2003 as shown in Figure 4. Asian Miracle years from 1980s to 1997/98 Asian Crisis have greatly reduce unemployment rate for both female and male. Post Asian Crisis era not only keeping both unemployment rates between 3% and 4% but also has reduced the gap between female and male unemployment rates. While female has higher tertiary enrollment as compared to male, why their unemployment rate is still higher? Is it discrimination against women?

Figure 5 presents female unemployment in descending order for all 14 states (minus Labuan). Women unemployment rate is clearly higher than male in all states except for Kuala Lumpur, Johor and Kelantan. Kelantan recorded the second lowest female unemployment rate and is one and only state where male unemployment rate is higher than female. Highest female unemployment rate states for 2010 are Sabah (5.8%), Sarawak (4.7%) and Perlis (4.5%). Meanwhile, the states with biggest unemployment gap between genders are Perak and Pahang. While states of different size and development level like Melaka, Kelantan and Penang can achieve a low female unemployment rate, why unemployment rate in states like Sabah, Sarawak and Perlis can be twice as much?

Figure 4: Malaysia's Unemployment Rate by Gender (%)

Figure 5: Unemployment Rate by States, 2010

(Source: Malaysia’s Statistical Department)

Conclusion

While we are hearing hope upon hope for gender equality, actual statistic and trend revealed the darker side of reality. Malaysia’s female labor participation rate has been sustained around 43% without breakthrough improvement. This rate is still way below many developed and developing countries in the world. Education seems not a deterrent factor for woman to participate actively in our economy. Indeed, female has better enrollment ratio to male. Yet, statistics show that female unemployment is higher.

It is not true that non-working women (example, housewife) did not contribute to the economy. In contrast, it is important and beneficial that women play more active role and direct participation into the economy, particularly the women group with substantial education. They are the human capital for growth. Hence, more and more understandings and critical debates are still needed to realize the hope for gender equality in term of employment, opportunity and role to the economy. 

[Chinese version published at Nanyang Press, 17th February 2014. Available online at http://www.nanyang.com/node/600218. This English version may be slightly different from the Chinese online/printed newspaper version]