Engendering Facts
Do you know that impact of export growth and female employment in the apparel sector in Madagascar has been different in case of the poor and non-poor households?
Linkages between rising exports and faster economic growth and development have been an area of debate in the era of liberalisation and it has been argued that trade between developed and developing countries has done little to reduce poverty of the latter. The road towards economic growth is through labour market where employment opportunities reduce poverty with a rise in real wages and equity. However, employment growth by itself does not guarantee poverty reduction if higher employment is achieved through low skilled and low paid jobs.
This paper examines a similar case in Madagascar which reflects many of the characteristics of least developed countries such as high rates of poverty, low wages, and a large pool of ‘reserve labor’. The country’s textile and apparel industry has been one of the fastest growing sectors in Sub-Saharan Africa. However, the effects of export growth on poverty, on social inequality and on gender equality in particular, have been mixed. This study examines the effects that export growth in the textile and apparel sector had on social welfare and the gender wage gap in Madagascar.
Madagascar experienced very fast growth in the apparel sector between 1997 and 2003, with a growth of about 150,000 jobs and an increase in exports from $200 million to almost $500 million. Due to the phasing out of the Multi-Fibre Agreement (MFA) there was a brief period of low activity and exports started rising again reaching $ 600 million in 2007. The expansion of the garment industry has had important repercussions for women, as more than 80 per cent of the new jobs have been filled by female workers. In the case of Madagascar, 85 per cent of the women who found new employment in the textile sector had never received any monetary income earlier. Again, the fact that a large majority of female workers were able to earn income gave a boost to their social status. Thus, the creation of jobs in the textile and apparel industry has been able to provide a way out of poverty for significant number of the households whose members were employed in this sector.
The study also finds that the textile and apparel industry in Madagascar had achieved an average earning of 40 percent higher than income of the workers in the other informal sectors and wages have been rapidly increasing. However, it is to be noted that the increase in wages has been limited to skilled workers alone and the poor generally provided unskilled labour. In terms of distributional aspect, it is seen that the non poor households reaped the benefits both in absolutue and relative terms. “Given that about 70 percent of the Malagasy population is poor, an effect of the expansion of the textile and apparel sector would be an increase in inequality between poor and non poor, between urban and rural areas, and between skilled and unskilled workers”.
Possibly the most important issue regarding women’s employment in developing countries is that it is often temporary and largely informal and this makes the development of specific skills more difficult. The result is that women generally remain as low-wage earners in the pool of unskilled workers. Women employed in developing countries are found to be earning less for the same job when compared with their male counterparts and this wage-income disparity also indicates the existence of gender bias within the society.
The results of the analysis suggest that the growth of external trade as a result of the expansion of the textile industry in Madagascar leads to a significant increase in social welfare. However, while the poor receive a reasonable share of the increase in welfare, non poor households gain more both in percentage and absolute terms. However, this has a link to poverty and in this phase national poverty in Madagascar decreased by about 0.7 percentage point.
Source: http://www.unctad.org/en/docs/ciem2d3_en.pdf and
