1 / 13

Economic Crises and the Added Worker Effect in the Turkish Labor Market *

Economic Crises and the Added Worker Effect in the Turkish Labor Market *. İpek İlkkaracan Serkan Değirmenci Istanbul Technical University. * To be published in Levy Economics Institute Working Papers , www.levy.org

ciqala
Download Presentation

Economic Crises and the Added Worker Effect in the Turkish Labor Market *

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Economic Crises and the Added Worker Effect in the Turkish Labor Market* İpek İlkkaracan Serkan Değirmenci Istanbul Technical University * To be published in Levy Economics Institute Working Papers, www.levy.org * To be published in Antonopoulas, R., N. (Editor), Gender Perspectives and Gender Impacts of the Global Economic Crisis, December, 2013, Routledge: New York. http://www.routledge.com/books/details/9780415658171/

  2. Motivation I 2 conditions for emergence of a strong Added Worker Effect (AWE) • Low female employment levels: Single male breadwinner household structure dominates • Limited social security coverage Turkey fulfils both conditions. • hence expectation: strong potential for AWE as a HH strategy against U shocks

  3. Motivation II • Three studies on the AWE in Turkey: • Baslevent and Onaran (2003) • Polat and Saraceno (2010) • Karaoglan and Okten (2012) Thesepapersexplore: • Whetherthere is a AWE in Turkey (1,2,3) • Strength of AWE in terms of increasinglikelihood of women’s LFP (2 and 3)

  4. Motivation III This paper distinct from earlier studies in that we: • use the recently introduced HHLFS question on previous year’s labor market status to identify «female added workers» and profile their demographic and job characteristics • estimate how widespread the effect is i.e. What share of female homemakers / U shocked HHs use this as a smoothing strategy? 3. estimate the quantitative impact of AWE on overall unemployment rate and female LFP rate in the 2008-09 economic crisis • estimate the strength of AWE through its impact of increasing likelihood of female transition from homemaking to labor force participation i.e. not simply effect of unemployed husband on female LFP status but a more dynamic question of women’s transition from homemaking to labor force participation in response to male transition from employed to unemployed status 5. explore how this likelihood varies substantially across different profiles of women by rural/urban, age/prime working age, education, marital status 6. explore if there is any substantial variation in the AWE over economic booms versus busts

  5. The Minister in Charge of Economic Affairs, Mr. Mehmet Simsek stated during a public speech at a Conference entitled “The Global Financial Crisis and the Turkish Economy”: You know why the unemployment rate has been increasing? Because more women than before start looking for jobs in times of economic crises..… [of the 50 million people who are the potential labor force in Turkey] more than half do not search jobs because they are housewives or students. …. Hence it is important to have a correct reading of the implications of rising unemployment rates for the real economy. If there is unemployment because people have lost jobs, this means they are pushed out of the market, and of course this will create a negative impact on the economy. But if the person did not have a job before starting to look for one and that is what causes unemployment to rise, this would have a more limited impact on the economy. Hence we should not pump up the pessimism and try to have a correct reading of what this rise in unemployment means. (Milliyet Daily Newspaper, 18.03.2009)

  6. Data andMethodology I • HHLFS micro data 2004-2010 • Operational sample: • Women ofworking age (15-65) who were in homemaker (or retired)status in the previous period • and living in households with a male breadwinner in thepreviousperiod. Identify (female) AddedWorkers: • womenwhomadethetransitiontoemployedorunemployedstatus in thecurrentperiod but excludingthosewhomovedinto self-employedorunpaidfamilyworkerstatus in agriculture. • in thosehouseholdswherethemalebreadwinnermadethetransitionfromemployedtounemployedstatus

  7. Data andMethodology II • Estimatetheextent of the AWE using weighted numbers of householdssubjecttotheunemploymentshock • Econometric estimation of thequantitativeimpact of HH unemploymentshock on transitionprobability of femalehomemakertolabor market yi = α0 + α1Ushocki + α2 Xi + α3Ur+ α4Ar + α5Sr + µi

  8. EmpiricalAnalysis:Identifyingthe AWE throughTransitionsbtw LM States – NumbersandShares of FemaleAWs Table 1 – Transitions between Labor Market States by Men and Women in Households Experiencing an Unemployment Shock * Thenumbersareweightednumbers.** Percent of allemployedmalehouseholdreferencepeople. *** Percent of allfemalehomemakersliving in theunemploymentshockhouseholds. Source: TurkStat, HLFS micro data 2004-2010.

  9. Table 2 – Transitions to the Labor Market by Women in Unemployment Shock and Non-Shock Households 2004-2010 * Thenumbersareweightednumbers.** Percent of allfemalehomemakersliving in therelevanthouseholdcategory. Source: TurkStat, HLFS micro data 2004-2010.

  10. Table 4 – Comparison of Married Women’s Transition Ratios in Turkey with 11 EU Countries Source: The transition ratios for Turkey have been calculated by the authors from HLFS micro data for the year 2009. The figures for the EU countries reproduced from Prieto-Rodriguez and Rodriguez-Gutierrez (2003) were derived from European Community Household Panel (ECHP), for the years 1994-1995-1996.

  11. DemographicandJobCharacteristics of FemaleAddedWorkers • What kind of women? • Lower educated (more than two-thirds have primary or less schooling) • Younger (under 40 years old) • Married (about 70-80 percent) • Mostly in urban residence (two-thirds) • What kind of jobs? • Full-time (79 percent) • Salaried (87 percent) • Low social security coverage (36 percent)

  12. EmpiricalAnalysis:EstimatingtheMarginalEffect of theUnemploymentShock on TransitionstotheLabor Market Table 3 – Marginal Effects of a Household Unemployment Shock on Female Homemakers’ Transitions into the Labor Market

  13. Conclusions • AWE exists in Turkey but limited in extent despite the fact that the two conditions for its emergence are there. • Only less than 10% of potential working age female homemakers living in HHs subject to U shock enter the labor market • There is a non-negligible increase in the effect due to economic crisis yet the impact on U rate or female LFP rate is very limited • The transition ratio is low also in comparison to EU countries • HH U shock increases likelihood of female homemaker’s transition by about 3-7% • YET, substantial variation in strength of AWE effect across different profiles of women – from as high as 34% for a university graduate homemaker in the 20-45 age group to as low as 7% for her counterpart with a secondary education. • Why is AWE limited in extent? • structural factors against women’s entry into the labor market weaken such potential (such as lack of work-family reconciliation mechanisms) • High U rate counteracts the AWE

More Related