Women empowerment is key to national happiness, according to a professor of Royal Thimphu College, Sanjeev Mehta.
Presenting his paper ‘link between export orientation, female employment and higher productivity: a case study of Bhutanese Industries’ at the International Conference on Gross National Happiness (GNH) on November 9, he said that greater and more productive employment opportunity positively stimulates happiness experience of the female which permeates as greater welfare at a household level.
The study is based on cross-sectional data from 41 large and medium scale Bhutanese firms and the professor said that to link GNH of business with women empowerment in the labour market, firms should address workplace discrimination, use appropriate technologies, and offer equal job opportunities to the female labour rather than at low capital intensive- low skill jobs.
Sanjeev Mehta said that creation of more productive jobs for female labour will not only strengthen GNH orientation of businesses but will also help in achieving Sustainable Development Goals (SDGs).
The study found that productivity of female labour was higher in the export-oriented industries than domestic market-oriented firms.
He said that he used the Cobb-Douglas production function to study the productivity coefficients of female labour and found that export-oriented industries were 0.179 while domestic market-oriented firms was 0.038.
Sanjeev Mehta said that although the productivity of female labour remains far below male labour in all the manufacturing industries, the gap is significantly reduced in the export-oriented industries.
He said that female labour in the manufacturing sector is trapped in a typical catch-22 situation, meaning that in the domestic market-oriented firms, higher female employment intensity is combined with lower productivity, while higher productivity situation is combined with lower female employment intensity in the export-oriented industry.
“Export-oriented industry engages females more productively than domestic market-oriented firms,” he said.
He also said that the impact of export orientation on female employment intensity depends on three broad factors – pattern of comparative cost advantages, which is an advantage that a firm has to produce a product at a lower cost; level of competition, which is the market power that a firm enjoys, and influence of foreign culture in management.
Sanjeev Mehta said that the impact of a foreign firm such as foreign direct investments (FDI) on the corporate culture and management practices help overcome nationally prevalent practices. “Faced with greater competition, firms adopt practices that cut down the cost of production, including overcoming taste for discrimination.”
Significant firm-specific determinants of female employment intensity are the size of exports, technological choices, and market orientation, the existence of foreign capital, and the age of the firms.
Women, he said, have been missing from the labour market because of systematic denial from equal access to jobs, concentration in low production jobs, wage discrimination, and sexual violence and exploitation. “Females are earning 77 percent less than male on a global level and it will take 70 years to bridge this gap. This is too long a wait.”
Female labour force participation rate in South Asia was found to be 55 percent less than the male, which has been increasing since 2005. Only about 20 percent of the female in South Asia are found working as employees in non-agricultural paid activities.