Export Processing Zone Expansion, Wage Labor, and the Impact on Gender Equality

Washington Consensus enactors assumed the importation of Western-style market liberalisation would have a spillover effect in Sub-Saharan Africa and improve gender equality with females having greater access to economic resources. While there has been a marked increase of female participation rates in the labor force, it has come at the cost of their health, living standards, and economic security. By working in the formal sector while continuing to shoulder household and reproductive duties females face a doubled work burden that has resulted in decreased life expectancies, increased vulnerabilities, and new forms of institutionalized marginalization. Though there has been recognition of the flaws of the feminization of wage labor, there has been little effort to alleviate the continued inequities faced by women in Sub-Saharan Africa. It is in the supposed greatest success stories – females employed in relatively well-paid occupations in export-oriented urban industries – that one can find the glaring deficiency of non-holistic, economically intransigent neoclassical development policies.

Within the trajectory of gender relations in the process of economic development within the neoclassical framework, it is thought that female’s status in the economy will be improved through market mechanisms, driven by the economic infeasibility of continued discrimination. This is derived from the creation of export-focused employment, which has strong demand for female labor and the unprofitable nature of discrimination, resulting in disproportionate growth of female wages relative to male wages. There is a strong link seen between trade flows and women’s employment opportunities in poor, labor-abundant countries, suggesting that trade liberalization and thus export focused industries provide a ‘window of opportunity’ for women (Nordas 32) From this expansion, female and male wages will converge to reach parity, remove labour market rigidities and eliminate the institutional roots of gender-based discrimination in labour markets.

From this standpoint, feminization of the work force can be seen as advantageous as women enter the labor market, receive an income, improve family welfare, and likely increase their self-sufficiency and bargaining power within the family (Blin 3). The current ‘efficiency policy approach’ in development tries to ensure the process is more effective in envisioning women’s economic participation as associated with equity (Kothari 19). The increase in trade liberalization and therefore market competitiveness has a supposed correlated trend with gender wage ratio, linking free market policies with betterment of female wages (Brainerd 1). Though Brainerd admits that trade may increase wage inequality by reducing relative wages of less-skilled workers, it appears to benefit women by reducing the ability of firms to discriminate (23). In a substantial sense, the barriers to entry for females and the institutionalization of gender discrimination should be eradicated in developing countries through the industrialization transformation within this construction.

In actuality, the process of globalisation, development, and market liberalisation has had immense consequences on intra-societal relations and exerted further pressure on gender imbalances. To many, the three practices have become interwoven into a rigid, mass-produced course of action that intentionally disenfranchises the local and the organic, and thus the feminine element as well. For women the structural changes from globalisation can be an underhanded arrangement of domination and disempowerment, which impact social groups differently and some detrimentally. Moreover, “men and women differ in their responses to globalisation” (Olurude 67). Gender issues rank low in terms of trade policy though they have profound effects on women and the community as a whole (Musonda 9). Non-feminist economics, such as Glick, have also weighed in on this theme. He states ’these changes [globalization and development] have tended to benefit men more than women’ (752).

At best, this myopic strategy can be seen as an extension of poor planning and narrow-minded thinking. Horn laments, “caught in the simplicity of economic equations, planners have failed to see the social structures, power relations and knowledge systems embedded in communities where development theory is applied. Gender policy in particular suffers from this blind spot of development practitioners” (110). These approaches combine to not only represent a hierarchical, western-based and biased approach to gender, but also ignore the subtleties of power and gendered space (Horn 110). Whereas economic betterment through wage increases is straightforward, the concept of social and political status is far more complex and hence ‘an increased income does not necessarily lead to increased authority or social recognition’ (Horn 110).

At worst, globalization can be seen as the universal perpetuation of male-female disparity: “The perception of globalisation by the female gender is as an extension of male chauvinism which further confines women to the domestic arena and the informal sector by excluding them from the public sphere” (Olurode 71). The division of labor in the household remains rigid along gender lines. Consequently, women often encounter a double-work burden scenario where they enter the productive economy, but still remain responsible for the reproductive economy (Blin 5). The double-work burden has deleterious effects on female health, decreases leisure time, and reduces time spent on the caring economy (Blin 6). The time and energy women expend in the household economy compete with time available to work in the cash economy or to participate in local decision making organizations, effectively reduces women’s routes to gender parity. (Musonda 3). At the same time, women experience little intra-household changes in income distribution, workload, or social status when they enter paid export processing zone (EPZ) wage labor.

While women possess a competitive advantage in the feminization of the labor force, the advantage stems from negative gender norms and discrimination (Blin 5). Employers perceive women as more docile, more accepting of poor working conditions and less likely to be involved in organized labor (Kothari 28). Women are also regarded as being “naturally” more suited to tedious and repetitious work and more easily controlled and managed (Kothari 28). Continued discrimination leads to the persistence of women earning less than their male counterparts, and their concentration in part-time, manual, or semi-skilled areas (Kothari 28).

In Africa, one particular macro level effort to benefit from market liberalisation and inclusion in globalisation is export processing expansion, often resulting in free trade or export processing zones where bureaucratic and economic barriers are eradicated to attract foreign investment and business. Emerging countries promote EPZs as a concentrated approach by which to reap benefits from the global economy (Glick 723). However, Workers in EPZ’s are relatively unprotected in the workplace; and, often they are subject to specialized national legislation that prevents them from unionization and security of employment (Nababsing 4). This encourages foreign direct investment, which seeks to profit by lax minimum wages and employment standards. For workers this can mean an EPZ characterised by long hours, hazardous conditions, constraints on workers’ rights, and generally unfavorable relations between enterprise owners and employees (Nababsing 7). The development strategy expects mass employment, technology transfer and enhanced skills in the industrial sector to alleviate poverty. These industries are specifically interesting as they are marked by the predominance of young, semi-skilled female workers (Glick 722). As Glick observes, it is ‘equally unresolved’ whether growth in this sector is ultimately beneficial to women and ‘hence to the objective of gender equity’ (723). Evidence shows that export-oriented strategies have ‘exacerbated or perpetuated’ the gender wage gap and produced employment characterised by hazardous conditions (Blin 5). It is important for employees to learn about common illegal situations that can happen in the workplace. Knowing about common illegal practices can help employees recognize and prevent them, read more facts at hkm.com.

Activity in the export processing zones (EPZs) of Madagascar highlights the movement of women towards export-oriented industries. Those industries, however, adversely affected female wellbeing and household responsibility, making long-run EPZ wage employment unsustainable. Madagascar created an EPZ called Zone Franche in 1989 to attract foreign non-technical industries. These industries attracted a disproportionate number of women with lower levels of education previously engaged in low-wage informal sector services (Glick 722, 724). From 1995 to 2002 informal wage employment decreased from 24 to 14 percent of the female workforce, while the formal employment in Zone Franche rose from 5 to 15 percent of total female employment (Glick 725). Nominally, this provided relatively well-paid jobs to lower-skilled females and the potential to contribute to improve overall gender equity, especially within urban economies (Glick 722). But, there were few spillover effects that lessened gender discrimination in other private sector employment or in the informal wage market, where men are paid substantially more than women with the same education and experience (Glick 746). Additionally in Zone Franche, statistics showed men were more likely than women with similar qualifications to receive a promotion (Glick 750).

Regardless of economic remuneration, the industrial sectors in the Zone Franche are marked by adversely long working hours and high turnover rates, to the extent that it prevents it from being a foundation of long-term employment and economic advancement for women (Glick 722). Despite higher rates of access to paid leave, the protection of unionized labor environments, formalized and legal employment contracts, and employer-sponsored health care, women work strikingly longer hours, often involving intense exertion: an estimated difference of 40 hours a month compared to non-EPZ private sector employment and 60 hours compared to public administration employment (Glick 750). Further, the stability of female wage labor is negatively affected by longer hours and a greater intensity of work, leading to one in five Zone Franche employees leaving their job each year (Glick 750). For women, these aspects of EPZ wage labor employment interfere with their ability to work in this sector and to balance their responsibilities as mothers and potential mothers, as well as being potentially detrimental to health (Glick 750). Beyond superficial short-term compensation of higher wages, the experience of Madagscarian women demonstrates that engagement in unhealthy and strenuous wage labor combined with high turnover rates leads to volatile economic and personal situations making long-term EPZ employment untenable.

Mauritius also employed an Export Oriented Industrialization strategy in the early 1970s. The creation of the EPZ brought about a sudden, rapid feminization of the labor force. The Mauritian EPZ specialized in textile and manufacturing industries with a large female labor force in which women accounted for 68 to 80 percent of the EPZ labor force in the 1980s and 1990s. Prior to the creation of the EPZ, women comprised a mere 20 percent of the overall labor force (Blin 7). The fragmentation of the labor market in the EPZ was stark: men were generally employed in the non-tradable industrial sector, while women dominated employment in the tradable sector.

Unions heavily recruited women only to find themselves manipulated by male union leaders, who ‘tried to inculculate a tradition of beauty contests among unionized workers’ and monopolise labour power for political patronage (Burn 44). In 1984 the Mauritian government intervened to correct the ‘female bias’ that threatened traditional gender roles and hierarchy, removing the male minimum wage while keeping intact the female minimum wage to encourage male EPZ employment (Burn 50). Dr. Lim Fat, the so-called ‘father’ of the Mauritian EPZ, backed this intervention; and he also advocated the government increase its subsidy of the cost of training male workers to 75 percent (Burn 50). Despite the increased employment of women, there still was a large wage differential along gender lines. 73.7 percent of women earned less than $900 per month, compared to 44.8 percent of men. At the same time 27 percent of men earned above $1900 per month compared to only 8 percent of women (Burn 55). These statistics provide valuable insight into the ability of men and women to negotiate higher wages and the level of gender discrimination and segmentation in the labor market.

The inflexibility in gender norms and continued dominance of the reproductive and household sector meant that women, even when commanding higher wages, encountered the double-work burden scenario. In a sample of females working in the EPZ, women spent an average of 51 hours per week in the factory, 3.5 hours per weekday on the household, and a combined average of 25 hours on Saturdays and Sundays in the formal and household economies (Blin 15). This totals to an average of over 102 hours worked per week in the productive and reproductive economies (Blin 16). While experiencing lengthy cumulative work hours, women similarly experienced a relative lack of leisure time: 60 percent of women reported less than 30 minutes of leisure on weekdays, as compared to 41 percent of men (Burns 67). Working women had to depend upon networks of women relatives and childcare services run by other women. As Blin eloquently states women working in the EPZ had the ‘worst combination of situations’: lengthy working hours and little available assistance in the household economy because of gender norms and lack of income (21).

The impact of the double work burden is best seen on the deleterious effects on females’ health in the EPZs of Mauritius revealed by their levels of fatigue and health status. A health survey conducted by Blin reveals the strain felt by women in the productive economy, with 57.5 percent complaining of poor work conditions and 83 percent of those interviewed saying they encountered health problems directly because of work, including backache, headache, and fatigue (18). It also appears that as determinants of women’s health status, the more women worked at home and at the factory, the more health problems they faced. This can be partially explained by women workers in the EPZ being concentrated into sectors where the mode of payment is determined by output (piece rate payment scheme) instead of salaried, and thus the relationship between pay, work effort, and intensification of work is most acute (Burn 62). More worrying than the effect of employment itself was the fact that the hours of factory work had a strong impact on health problems (Blin 18). Additionally, a health survey which Burns discusses documents that numerous health conditions were exacerbated by the combination of productive and reproductive work, particularly for married women (68). Even within the Mauritian system that provides free health care, thus ensuring access for female workers, the effects of the double work burden clearly impact female health for the worse. As Blin notes, there is an apparent trade-off between income women earn in the EPZ and the cost incurred in terms of working hours and health status (19).

Gender experience in the export-oriented industrial employment can be explored through the workplace atmosphere and environment for women. A 2002 report conducted by the International Labor Rights Fund showed disturbingly high amounts of sexual violence and intimidation in the Kenyan work place against women. Over 90 percent of 400 Kenyan females who responded had experienced or observed sexual abuse in the workplace (Karega 1). Women recognized that the consequences were immense for those who declined to yield to sexual advances, although giving in to abuse often left the victim trapped in a vicious cycle (Karega 25). Disturbingly, 70 percent men in the same workplace environments viewed sexual harassment of women workers as ‘normal and natural’ behavior (Karega 1). The Kenyan workplace environment that condones sexual harassment as acceptable has had tremendously negative effects on the psychological, economic, and familial stability of women’s lives.

There were also high levels of sexual harassment reported in the Kenyan EPZ that is dominated by the vastly feminized textile industry. One common method of sexual intimidation in the Kenyan textile trade was for male managers to arrange ‘overtime’ for women that would typically amount to sexual advances. If rebuffed, the managers would deny payment for work and threaten termination of employment (Karega 25). Many women in the EPZ saw submission to sexual harassment as a method to promotion, though the IRLC study showed that even female supervisors continued to be abused by managers and male colleagues (Karega 24). More telling, many women reported leaving jobs because of workplace environments where sexual abuse and harassment were prevalent, only to be forced to return because of lack of opportunities and obligations to bring income to the family. When they did report sexual abuse, they were often fired or demoted. Consequently, some 95 percent of women who suffered abuse were too afraid to report the harassment (Karega 1). Ominously, 66 percent of respondents thought that HIV/AIDS was being spread in the workplace and 61 percent believed it was being transmitted purposefully (Karega 15). This implies male managers and workers are utilising HIV/AIDS as a tool to manipulate and control female employees: women are the most vulnerable group for becoming targets ‘for getting caught in the trap of yielding to sexual demands then getting infected’ (Karega 15).

In both formal and informal channels, Kenyan workplace conditions are often ignored and unregulated, and even more so in the Kenyan EPZ that provides a safe-haven from internal protection mechanisms. In the formal law structure, neither Kenyan law nor international law nor prevalent codes of conduct protect women from violent sexual abuse in the workplace (Musonda 1). Trade unions, where women are often underrepresented and thus gender issues safely ignored, seldom attempt to check sexual exploitation and abuse. The ratio of female to male members in unions is 3 to 7, and at decision-making levels, women comprise only 11.5 percent of union leadership (Musonda 5). Even where there are unions, 90 percent of Kenyan workplaces lack codes of conduct. The rest of survey respondents, moreover, added that even if it existed, the code of conduct was not followed (Karega 28). In a situation where there is little intra-workplace support for ending sexual violence or peer labor support in forms of unions or networks, women are increasingly disempowered from being able to stop the cycle of violence perpetrated against them.

The experiences of women in Mauritius, Kenya, and Madagascar give enlightenment into the condition of females across Sub-Saharan Africa who enter the labour market in EPZ industries and continue to be mired in structural and normative impediments. The issue of a double work burden repeats itself across Africa due to gender role rigidity and male self-exclusion from participation in the household economy. Olurode sees this in the most labor-intensive household chore, food production and preparation. ‘Male labour participation in food production is much less regular than that of women’ resulting in a “double workload for women across the entire continent of Africa” (74). Women continue to face a plethora of micro-level hindrances in the globalised environment which planners envisioned would increase their economic resource capability. Men, for instance, have greater access to credit facilities and micro-loans. The privatisation of land often leads to males dominating the legal framework and technicalities (Olurode 75, 76). In this capacity, women continue to be on the outside looking in, affected by but unable to alter globalisation. As Horn terms, marginalised groups in Africa including women remain at the gates of the globalisation process ‘outside of the debate though objects of it’ (112).

Though able to recognize the serious nature of gender inequalities, the neoclassical field regards inequities as a result of market failures rather than as a function of social imbalances perpetuated or exacerbated by economic policy. This view caused economists such as Nordas to regard the economic impact of trade liberalisation as positive for women and to conclude that there is little proof that women are more susceptible to adjustment costs, despite evidence to the contrary (32). While not addressing the gender problems associated with market liberalisation, research by economists at the International Monetary Fund in 2006 showed that the gender gap impeded development and cost billions of dollars in lost economic growth (Thornton 1). At a statement at the Africa Development Forum in 2004, then World Bank President James Wolfensohn declared that women do the majority of the work, much to their detriment, and female ‘empowerment is the secret of development’ in Africa (4). The issue continues to remain whether market mechanisms can override deeply entrenched social normatives that stifle gender parity and if not, how to address the issue within the neoclassical controlled development of Africa.

The faults of the neoclassical approach to gender-equality and economic development can be traced to the roots of the framework: an inordinate valuation of the economic relative to the psychological and the sociological institutional barriers that prevent sincere gender egalitarianism. Horn locates the problem of the approach to gender in development practice in the “conception of gender as a ‘women’s issue’ with inordinate emphasis on data collection rather than transformative practice, and the focus on a liberal conception of empowerment, conceived of in terms of individual economic power” (110). For the women of the export-processing zones of Africa, the concept of economic betterment through increased wages has not led to social, political, or long term economic empowerment. Instead, EPZ wage labour employment has created longer working hours, increased socio-economic vulnerabilities, poorer health, and an overall perpetuation of gender-based social and economic imbalances.

Sources

Beneria, Lourdes. “Gender, Development, and Globalisation.” 2003.

Blin, Myriam. “Export-Oriented Policies, Women’s Work Burden and Human Development in Mauritius.”

Brainerd, Elizabeth. “Importing Equality? The Impact of Globalization on Gender Discrimination.” IZA Discussion Paper No. 558, August 2002.

Burn, Nalini. “Mauritius”. Gender and Industrialization. 1996.

Case, Anne and Angus Deaton. “Consumption, Health, Gender, and Poverty.” World Bank Policy Research Working Paper; Poverty Reduction and Economic Management Network. April 2003.

Elson, Diane. “Micro, Meso, Macro: Gender and Economic Analysis in the Context of Policy Reform.” 1991.

Glick, Peter and Francois Roubaud. “Export Processing Zone Expansion in Madagascar: What are the Labour Market and Gender Impacts?” Journal of African Economies, Volume 15, Number 4. Pages 722-756. 2006.

Horn, Jessica. “Looking from the South, Speaking from Home: African Women Confronting Development.” Development, Volume 43, number 4. Pages 32-39.

Karega, Regina. “Violence Against Women in the Workplace in Kenya.” International Labor Rights Fund. May 2002.

Kothari, Uma. “Gender and Industrial Change”. Gender and Industrialization. 1996.

Musonda, Flora and Flora Kessy. “Gender and Trade in Africa.” Economic and Social Research Foundation.

Nababsing, Vidula. “Industrial Strategies for Least Developed Countries”. Gender and Industrialization. 1996.

Nordas, Hildegunn. “Is Trade Liberalization a Window of Opportunity for Women?” WTO Working Paper, 2003. http://www.wto.org/english/res_e/reser_e/ersd200303_e.doc

Olurode, Lai. “Gender, Globalisation and Marginalisation in Africa.” Africa Development, Volume 28, Number 3 and 4. Pages 67-88. 2003.

Thornton, Philip. “Gender gap costs billions in lost growth.” The Independent, 2006.

Wolfensohn, James. World Bank Statement at Africa Development Forum. October 2004.

Written by Alec at SOAS for his MSc Political Economy of Development.

Related: What Explains Deviations from Interest Rate Parity in Emerging Markets?, Interview with Paul Romer on Mauritius, Did the World Bank’s Development Efforts Fail in Kenya?, and Paul Romer is Interviewed – Mauritius Times.

[tags]gender equality, gender relation, feminism, sexism, workplace atmosphere, export processing zones, work bank, policy, imf, female vulnerabilities, african economics, wage labor, labor market[/tags]