Inclusive social development: The next generation of policies for overcoming poverty and reducing inequality in Latin America and the Caribbean

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Inclusive social development: the next generation of policies for overcoming poverty... jobs themselves; when those aspects are controlled out of the equation, the probability of pension system registration increases among women. Nevertheless, the values are negative in the case of households with children headed by women compared to those led by men, which reflects their greater fragility and the need to accept low-quality jobs (ECLAC, 2013b; Amarante and Sojo, 2015; Sojo, 2015). At the same time, to correct exclusions from traditional contributory regimes, subsidized regimes associated with contributory ones have been strengthened, as is the case in the health systems of Colombia and Costa Rica, and solidarity-based social protection pillars. Box I.2 examines the volumes of non-contributory pensions in six Latin American countries. Household survey data can be used to analyse non-contributory pensions in six of the region’s countries. a Chile is the country with the highest solidarity-based pensions, followed by Costa Rica. In turn, Bolivia has the lowest non-contributory pensions but the highest coverage, because of the scheme’s universal reach. In general, a Box I.2 Non-contributory pensions in Latin America slightly higher proportion of women receive pensions of this kind; the most significant difference is found in Chile, possibly because the solidarity-based pillar recognizes care work. At constant values, the amounts of solidarity-based pensions have increased in Bolivia and Chile, while they have fallen in Ecuador. Latin America (6 countries): persons aged 65 years and over receiving a non-contributory pension, by sex and average monthly amount of pension (Percentages and constant dollars at 2005 prices) Country Year Total Men Women Proportion Amount Proportion Amount Proportion Amount Bolivia (Plurinational State of) 2002 69.5 9.3 72.3 9.6 67.1 9.1 2011 95.5 15.6 94.6 15.4 96.3 15.8 Chile 2000 14.0 67.0 11.6 67.1 15.9 67.0 2013 30.4 107.6 22.3 105.0 36.3 108.8 Costa Rica 2013 17.7 83.1 15.1 83.5 19.8 82.9 Ecuador (urban areas) 2002 14.8 41.8 13.1 37.2 16.4 45.3 2013 30.3 35.1 26.7 35.1 33.5 35.1 Mexico 2012 33.6 36.0 33.0 35.3 34.0 36.5 Panama 2013 26.3 69.4 22.9 69.4 29.3 69.4 Source: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of special tabulations of data from household surveys conducted in the countries. Note: The data for 2002 for the Plurinational State of Bolivia refer to the Bono Solidario (Bonosol), which provided an annual pension of 1,800 bolivianos, converted here into monthly values to enable comparison with the 2011 figures. The amounts for 2011 refer to the Renta Dignidad basic old-age pension, which provides a monthly benefit of 200 bolivianos. Source: Economic Commission for Latin America and the Caribbean (ECLAC). a The Brazilian surveys contain data on non-contributory pensions in special modules, but their breakdown does not allow comparisons to be made with the household surveys of other countries. 4. Women’s labour participation, gender inequalities and poverty reduction The labour market is also a crucial sphere for advancing towards the goal of equality for women (ECLAC, 2014a). Although it offers them the possibility of economic autonomy and is essential for their social inclusion and the full enjoyment of their citizenship, the labour market is still characterized by pronounced gender inequalities in various areas (incomes, participation, access to different jobs, etc.) that hamper those possibilities. Several studies on the topic in the region (for example, ECLAC/FAO/UN Women/UNDP/ILO, 2013) show significant changes in female labour force participation. However, these changes have taken place at different rates in each country, and even among women in the same country, varying by income level, education, racial or ethnic origin, and the number of minor-aged dependants at home. As stated in the Social Panorama of Latin America 2014, the labour market and its flip-side, unpaid work, constitute a single, complex issue in which a series of changes are urgently needed to accelerate progress towards equality. It is necessary to reduce gaps in participation, employment, income, formalization and access to social protection, and to introduce policies for reconciling work and family life for men and women (ECLAC, 2014a). Chapter I 41
Economic Commission for Latin America and the Caribbean (ECLAC) Recent changes have been significant, but major inequalities still exist. The increased presence of women in the labour market, measured by both labour participation and employment rates, is among the most significant changes. As a result, between 2002 and 2012, differentials in both participation and employment fell: in 2002, the weighted average female participation rate in 18 Latin American countries was 63% of the male rate, and that figure had risen to 67% by 2012. Similarly, the employment rate among women in 2002 was 61% of the men’s rate, rising to 65% in 2012 (ECLAC, 2014a). These rising participation and employment rates were accompanied by significant increases in their contribution to total household income which, in many cases, kept them out of poverty or enabled them to escape it (ECLAC, 2010a). But although the gender participation gap has narrowed in most of the region, it nevertheless remains significant. For example, the female participation rate in Guatemala, Honduras and Nicaragua is on average half the male rate, and even in countries where the gap is smaller, the participation rate for women falls short of 80% of the rate for men (this is the case in Peru, the Plurinational State of Bolivia and Uruguay). This means that, despite the considerable differences between the countries, there remains broad scope for increasing women’s labour market participation in all cases (ECLAC, 2014a). Sizable differences also exist between the labour incomes of men and women. In all the region’s countries, women’s average monthly earnings are lower than men’s. These differences by sex for the employed population as a whole are also observed in individual occupational categories. The gaps vary significantly between countries: in the Plurinational State of Bolivia and Peru, men earn on average over 50% more per month than women, but in El Salvador, Honduras and Panama, the difference is less than 10% (ECLAC, 2014a). Moreover, at present, 52.5% of women are employed in low-productivity sectors, 23 compared to 44.1% of men, which indicates a pronounced differential between the sexes and in levels of income: 82% of working women in the poorest quintile of the population work in low-productivity sectors, a proportion that in the highest-income quintile falls to close to 33%. This indicates that the workforce is still highly segmented by both socioeconomic factors and gender (ECLAC, 2012b). What impact does increased participation by women in the labour market have on the reduction of poverty and inequality? The 2014 edition of Social Panorama of Latin America contains a simulation, using data from 18 countries, that illustrates what the region’s income inequality and poverty levels would be if the differentials in participation rates and incomes between men and women were reduced. In the first scenario (reduced labour participation differential), the exercise showed that this would lead to an increase in average household income ranging from 3% to 4% in Argentina, Brazil, Colombia, Mexico and Uruguay, and reaching over 10% in El Salvador, Honduras, Nicaragua and Peru. The countries with the largest gender gaps in labour participation would gain the most in terms of average income. In addition to lowering poverty, evening up the rates of female and male participation would reduce inequality (between 1 and 4 percentage points of the Gini coefficient) (ECLAC, 2014a). The simulation also shows that the additional elimination of the income differential between men and women (second scenario) would have a major impact on reducing poverty in countries like the Plurinational State of Bolivia (-14 percentage points), Colombia (-9 percentage points), Ecuador, Nicaragua and Peru (-8 percentage points). A significant percentage of women in these countries are occupied but not paid, which explains the dramatic changes that would take place if these women were to receive a similar income to men with the same level of education and work experience. The Gini index would fall by between 2 and 9 percentage points (ECLAC, 2014a). 23 ECLAC deems the following to be workers in low-productivity sectors: members of the working population aged 15 and over who are employers of companies with five workers or fewer (microenterprises), non-professional non-technical wage earners in microenterprises, independent workers, non-professional non-technical unpaid workers and those employed in domestic service. Chapter I 42
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Inclusive social development: The next generation of policies for overcoming poverty and reducing inequality in Latin America and the Caribbean

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