Women “specialise” in working from home

“Why are women as women interesting for economics?” – asked Péter Isztin, Associate Professor at the Institute of Economics, in his opening presentation at the Corvinus conference “Claudia Goldin and Women’s Economics” on 12 April. At the event organised by the Committee on Economics (KTB) of the Hungarian Academy of Sciences, he said, “flexible labour supply has brought about major changes in the participation of women in the labour market. Women all over the world are doing more of the housework, and this work is not included in GDP. Women give birth and to a large extent take care of the children, even in developed countries.”  

Claudia Goldin, who studies economic history and women’s participation in the labour market, studied at Cornell University, where, as Isztin said, “she was trained by the economist Alfred E. Kahn” (probably she was his most famous student). She then went on to study at the University of Chicago, where she was mentored by Robert Fogel, economic historian (also a Nobel laureate) and Gary Becker, professor of economics and sociology (also a Nobel laureate). Goldin wrote her dissertation on slavery, but then turned to labour economics, following the Chicago economic tradition. Since 1990, she has been a professor of the economic department at Harvard, where she has researched a wide range of issues affecting women. She has looked at how contraception affects women’s career and marriage choices and careers, and the causes of the gender gap. Isztin believed that the American economics professor had long been a contender for the Nobel Prize. 

There is a strong correlation between economic development and women’s participation in the labour market. In the first half of the 20th century, the demand for women in the labour market began to increase as a result of development and industrialisation. Fewer children were born because of the advent of contraception, but “it was worth investing more” in providing them with a quality education. All of these important topics were greatly influenced by Goldin’s research and writings. The economics professor dealt with discrimination against women and the so-called marriage bar: this meant (not only in the US) that married women were not wanted in the labour market, and those who married were often dismissed. Employers justified this by saying that women should be at home and men should support the family. Goldin showed that, in fact, most of the promotion in companies was from within, and to raise money for this, married women were made redundant. 

Goldin also looked at the fact that in 2000, orchestras started to use the so-called blind audition: applicants for orchestras started to be recruited by having men and women auditioning behind a curtain, so that the decision-maker was not influenced by the gender of the musician, but had to decide solely on the basis of what he or she heard. 

Gender pay gap still exists today, but decreases 

Goldin’s research and publications, as Isztin pointed out, increased women’s activity in the labour market, and in the 1960s and 1970s, there was a surge in women applying to medical and law schools.  As Isztin said, the gender pay gap still exists, but the trend is downwards, and there is also a trend towards a greater gap between higher earnings. The reason is that there are positions in companies that are very difficult for women to get, and the gender gap already widens immediately after obtaining a master’s degree. At the same time, it is also the case that women themselves, precisely in order to take care of their children, prefer to work more flexible hours, not wanting to be at the company’s disposal all the time. Finally, Isztin said he would like to talk a little about men. There are some situations where men are at a disadvantage: there are now more women in higher education than men, and women are also better at learning. 

Then, Rita Pető, Research Fellow at the HUN-REN Centre for Economic and Regional Research (her co-author is Balázs Reizer, Corvinus) spoke about the research entitled “Gender differences in the use of cognitive competences at work”. Rita Pető stressed that the gender pay gap narrows all over the world, the relative position of women has improved, they are less segregated and less likely to be in low-paid jobs. Their research is based on data from the Program for the International Assessment of Adult Competencies (PIAAC) – data from several European countries, the USA and Japan are also included in the international database. This survey looks at what skills employees use in the workplace. Mathematics, literacy and ICT skills were also evaluated.  

Men do less housework than women even if they are single 

Analysis of the data shows that there are significant differences between men and women in their use of skills, but this is not because of differences in competences. Women perform less skill-intensive tasks in the workplace, and there is a significant difference in skill use between them, equivalent to about 4-5 years of schooling. One very important reason for this, according to the research, is that the number of hours spent on children and housework is significantly higher for women than for men.  

They looked at the difference between single men and men in relationships separately, and found that men in relationships use more skills in the workplace compared to their single counterparts. Interestingly, single women also spend more time on housework than single men. Rita Pető also talked about the reasons for the unequal sharing of housework: women do not have a very good bargaining position because their partner usually earns more, so they “specialise” in domestic tasks. Pető mentioned that women are also forced by social expectations to do more housework – this is the case everywhere, also in post-Soviet and Nordic countries. 

Deciding to have children in a workplace that is closing down: support is important  

Ágnes Szabó-Morvai, Senior Research Fellow at the HUN-REN Centre for Economic and Regional Research, lecturer at the University of Debrecen, spoke in her presentation entitled “Preview of childbearing and abortion decisions in times of employment shocks” about how women react in the event of factory closures or mass headcount reductions: do they have a baby or have an abortion? She said, “There are 327 abortions per thousand live births in Hungary.” As she said, abortion is common around the world, with 930,000 women in the US having an abortion in 2020. In 74% of cases, the typical reason is due to school, work or financial reasons; the woman cannot afford to give birth for some reason. She stressed that abortion can have serious consequences: women often feel guilty afterwards, they are 37% more likely to suffer from depression, and they are more prone to anxiety, drug abuse and even suicide. That is why she believes it is important to develop policies that support women when they have to make decisions on such issues.  

As she noted, news of the factory closure and mass headcount reductions reaches women before they happen, putting them in a decision-making situation. In the case of a mass headcount reduction, the pregnant woman can expect that she cannot be dismissed under the law. “’I’ll come back to work when the child is two and a half,’ thinks to herself and keeps the child,” she said. This is also because, according to the researcher, there is no chance of finding a job when pregnant, and if the mother is out of work, she loses the benefits she receives after the baby is born. 

Flexible wages widen the gender gap 

Balázs Reizer, Associate Professor at Corvinus University, in his presentation “The role of flexible wage components in gender pay gaps”, said that women are less likely to find jobs in well-paying companies where employees can expect bonuses and overtime pay. Where there is only a base salary, there are no gender pay gaps, but flexible wages lead to wage inequality, which disproportionately affects women. As he said, on average, the pay gap for women is 25 percent where there are flexible elements in wages. However, it is also true that women are much less likely to go to work in companies where they have to work long hours. The reason is that women have less bargaining power than men and do not want to work for companies with flexible wages. He stressed that tightening up flexible wages is a double-edged sword, as it would reduce the pay gap between women and men, but also productivity. Reizer also said that there is a lot of evidence that companies often do not pay overtime hours worked. 

In her closing remarks, Dóra Győrffy, President of the KTB and professor at Corvinus University, stressed that the conference is proof of the inspiring influence of a Nobel laureate like Claudia Goldin on young researchers. 

Katalin Török