The gender dimensions of global value chains: Five key lessons

11 October 2016

Picture this: A group of young women, dressed alike in trendy uniforms, step out from a high rise office building on their way home from work. These women are first generation college graduates who have landed their first jobs in the Philippines’ growing call centre industry. In a country where GDP per capita is under US$3,000, and many are struggling to seek out a living, or simply move abroad in search of work, the country’s emergence as a leading offshore services provider has offered a very welcomed opportunity.

Similar stories have frequently been used to highlight how increased globalisation has brought about important change and opportunity for women in the developing world. Other well-covered examples are how the growth of ready-to-eat fresh fruit and vegetable exports in East Africa and apparel exports in Asia brought with them a boom in employment for young female workers – their first experience with remunerated work. Policymakers are increasingly turning to integration and upgrading in global value chains (GVCs) as a means of driving development, including generating employment and raising incomes.

Yet, at the same time, reports of appalling working conditions in many export sectors, such as those that led to the Rana Plaza tragedy in Bangladesh in 2013, are stark reminders that this is not always the case. As policymakers, this leads to an essential question: How and under what conditions can engaging in GVCs support economic and social development as well as gender equality?

In order to understand how GVCs can contribute to these sustainable development goals, it is crucial to view GVCs through a gender lens. Access to and benefits from GVC participation are closely related to gender-specific issues. Below, we highlight five key lessons from the analysis of GVCs in different sectors.

1. Participation in GVCs generally has a positive impact on female employment

Participation in GVCs generally does have a positive impact on employment, female employment in particular. This provides an important step towards economic independence. As with the call centres offering young female Filipino graduates a chance to work in a global business, apparel factories across Asia and Africa provide women with jobs in manufacturing production, and the expansion of fruit and vegetable trade opens the door for female packers. Indeed, on average, 60–80 percent of production workers in apparel are women, while in horticultural 70–80 percent of packing jobs are occupied by women.

2. Most of the jobs created in GVCs do not challenge gendered job segregation

Gendered division of labour in economies is largely perpetuated in GVC employment, rather than altered. Applying a gender lens in policymaking and implementation is required to identify the positions and roles women and men have in GVCs, and what their specific rewards, opportunities, and constraints are. Most of the jobs created in GVCs do not challenge or dismantle gendered job segregation and related stereotypes, but are based on and use these gendered structures. This appears to be deeply rooted in social constructs and perceptions of what is considered appropriate male and female work. For example, men are typically favoured for positions that require physical strength, technical know-how, and supervisory and management skills, while women are preferred for jobs that depend on finesse, attention to detail and social and caring competencies.

3. Gender inequality in terms of wages remains important in GVC employment

Gender inequality with respect to wages remains an important issue in GVC employment. Often, jobs where women are concentrated are perceived as low-skilled jobs and are paid accordingly. This is related to gender perceptions of what is perceived as skilled and unskilled.  While this is in part a reflection of women being concentrated in lower-value activities, there are numerous examples where women receive lower wages than men for the same work. In the Indian cocoa sector, for example, women are paid less than men for the same work. In the apparel sector, product segments within apparel may be paid at different rates, such as in Bangladesh where knitters receive higher wages than weavers with men being concentrated in the former group.

4. Women as a group share similar constraints to participate and upgrade in GVCs

Operating in global industries requires firms and workers to have access to a host of resources to provide them with the capabilities to meet the demanding standards of export markets. These include access to credit, land, education, skills, and infrastructure amongst others. Access to these resources thus shapes the possibilities of both men and women to participate in different activities in any industry. However, women as a group share similar gender-intensified constraints to participate and upgrade in GVCs. These include unequal access to productive resources, training and skills development, and networks and information, as well as being more time-constrained than their male counterparts due to reproductive work responsibilities. For example, in the manufacturing sector in Asia, the more technologically sophisticated country exports became, the lower the ratio of women to men in the sector. The same is evident in Egypt’s offshore services sector, where men dominate the higher paying information technology positions, while women are concentrated primarily in call centre agent positions. 

5. Such constraints can undermine a country’s long-term competitiveness

This is not a one-way relationship, however, with economic participation affecting the social conditions in which men and women work. Gender inequalities can both facilitate and inhibit industry competitiveness. Low wages and flexible employment of predominantly female workers help reduce costs for employers, enabling them to offer cost-competitive, flexible and high quality products. But there may be a trade-off between short-term gains and longer-term upgrading. The gendered constraints highlighted here can undermine a country’s competitiveness to engage in GVCs. In small economies such as Costa Rica, women form a formidable part of the country’s offshore services workforce; without engaging and educating these women, the country would effectively be trying to participate in a highly competitive industry with just half the available labour. Similarly, restricting women’s access to land and capital in the agricultural sector can undermine access to higher returns and great quality products. In Honduras, once exporters opened their outgrower programmes to women, they found their credit repayment rates were almost 100 percent, while the quality of the output was superior to that of their male counterparts. 

 

This post draws on the paper The Gender Dimensions of Global Value Chains published by ICTSD and authored by Penny Bamber and Cornelia Staritz.

 

Penny Bamber is Senior Researcher at Duke University Center on Globalization, Governance, and Competitiveness. Cornelia Staritz is Senior Researcher at the Austrian Foundation for Development Research (ÖFSE).