Women in paid employment: a role for public policies and social norms in Guatemala

ABSTRACT

With only 32% of women in the labor market, Guatemala has one of the lowest rates of female labor force participation (FLFP) in the Latin America and Caribbean region and in the world. We explore information from different micro data sets, including the most recent population censuses (2002 and 2018) to assess the drivers of recent progress. Between 2002 and 2018, FLFP increased from an average of 26% to 32% nationwide. This increase was partly explained by increases in the school attainment of women, reduction in fertility and the country’s structural transformation towards services. However, a large part of the increase remains unexplained. Exploring 2018 data, we show that social norms, attitudes towards women and public policies are important determinants of FLFP. The analysis suggests that, taken together, these factors can all become an important source of increased participation of women in the labor market moving forward¹.

KEYWORDS:

• female labor force participation
• gender
• Guatemala

JEL CLASSIFICATION:

• J16
• J21
• J22
• O12

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1. Our special thanks to INE Guatemala for invaluable support in access to the census data and to the Public Sector survey data. Fernando Paredes and Alejandro de la Fuente (World Bank) offered valuable support in data access. We thank Eliana Rubiano Matulevich for several comments. A previous version of this paper has been published as World Bank Policy Research Working Paper (9919), see Almeida & Viollaz (2022).

2. Between 2000 and 2018, Guatemala grew at an average rate of 3.5% compared with 2.7% in Latin America and the Caribbean region. The lower secondary completion rate of women increased from 28.2% to 55.2% and the number of births per woman declined from 4.6 to 2.9 over the same period (World Bank, 2021).

3. Guatemala per capita GDP was approximately $US 9,000 in 2019.

4. Figure 1 reports FLFP in aspirational country peers as defined by the WBG’s Systematic Country Diagnostic (World Bank, 2022) (Peru, Dominican Republic, Serbia, and Georgia) and structural peers (Honduras, Paraguay, Sri Lanka, and Senegal).

5. The Online Appendix presents a brief conceptual framework and a review of the literature on the factors driving FLFP.

6. This paper proposes education, marital status, fertility, and sector and occupational structure of employment at the municipality level as explanatory factors.

7. We follow Berlinski and Galiani (2007) and others and use 49 years old as an upper-bound. They analyze the relationship between FLFP and other labor outcomes, having children of young age and the construction of preprimary schools.

8. The census data can identify mothers and children only in households where women are household heads or when their spouses are.

9. See Table A1 for details on all the variables used throughout the analysis.

10. The gender wage ratio would be a better measure of the level of discrimination in local labor markets, but the 2018 census does not provide information on income variables.

11. House and WASH Index captures the type of dwelling, dwelling property, wall and roof materials, access to water, and type of toilet. Table A1 in the Appendix provides details.

12. Some limitations of having only one year of data is that the analysis is not informative about changes in the relative importance of the drivers of FLFP over time and it is not possible to control for differential labor market trends across municipalities.

13. Because the results of the unexplained component are not invariant to the choice of the excluded categories, we only analyze the total but not the variable by variable results (Fortin et al., 2011).

14. A working wife could be less socially accepted when the husband works.