Ongoing gender differences in the labour market

Based on Labour Force Survey data, Statistics Estonia has analysed gender differences among salaried workers. Although women are generally better educated, they tend to work in low-salaried and less prestigious positions than men. The findings reveal the presence of both vertical and horizontal segregation and show that a large gender pay gap continues to exist. It seems that better possibilities for reconciling work and family life are needed if the situation of women in the labour marke is to improve.

The Estonian national statistics agency Statistics Estonia (Statistikaamet, SA) has published in 2008, as part of its information sheet series, an analysis entitled ‘Women and men in employment’ (Naised ja mehed palgatööjõus (in Estonian, 283Kb PDF)). The analysis is based on data from the Labour Force Survey (LFS), which has been conducted on a regular basis since 1995. The target population of the survey are the working-age residents of Estonia – those aged 15–74 years. The survey results are representative of the whole population.

Employment indicators

The employment rate of women is dependent on the age of their children. Among families with the youngest child aged less than six years, only 56% of women are employed compared with 93% of men. Differences in employment rates are less significant among couples with older children aged between seven and 17 years: 88% of these women are employed compared with 93% of men.

Even though difficulties in combining work and family life for women are evident, flexible forms of employment are still not particularly common in Estonia. Since the beginning of the 1990s, the incidence of part-time work has increased more rapidly among women (Figure 1). However, it is still not a common occurrence as it means higher labour costs for employers and lower incomes for employees. Thus, women often need to choose between a full-time job and economic inactivity due to the lack of flexible working arrangements.

Part-time employees, by sex, 1989–2007 (%)

Part-time work is used more often by young persons due to ongoing studies and raising small children. Among those aged 15–24 years, 8% of men and 20% of women worked part time. In older age groups, part-time work is also somewhat more popular – for example, 6% of men and 15% of women aged 50–74 years worked part time in 2006.

Segregation in labour market

The public–private sector divide is gender segregated in Estonia, with more women working in the public sector and men in the private sector – 67% and 54% of the sector employees respectively. Since 1989, the importance of the private sector has increased more for men as they were more often working in companies that were privatised in the 1990s. Today, employment in the public sector may be more stable, better regulated and require less working hours, but it also has a worse reputation and lower wage levels.

Sectoral segregation is a rather typical occurrence in Estonia (Figure 2). The prevalence of jobs in the manufacturing sector among women is caused by the economic structure of the Soviet economy on the one hand and the division of the migrant population between economic activities on the other. For instance, almost a third (26%) of the non-Estonian population is employed in the manufacturing sector, while the indicator for Estonians in 2007 is 18%.

Most popular economic activities, by sex, 2006 (%)

Occupational segregation follows the general pattern – women work more often as white-collar workers and men as blue-collar workers. In addition, men are more often in higher occupational groups and represent 62% of legislators, senior officials and managers. The proportion of women working in lower positions is higher, such as service workers and shop and market sales workers (81%), skilled agricultural and fishery workers (60%) and elementary occupations (60%). At the same time, women tend to be higher educated than men. Only 7% of women have lower than an upper secondary education while the proportion of men in this category is twice as high. Furthermore, 13% of women compared with 8% of men have a job that requires lower educational levels than they currently hold.

Gender wage gap

The gender pay gap in Estonia is one of the largest in the EU. In 2006, the average gross monthly wage for women comprised 75% of the rate for men (69% in terms of the net wage).

The gender wage gap increases with age and is lower again for older workers. The smaller pay differences among younger persons can most likely be explained by the fact that, on entering the labour market, the conditions are more equal for young men and women. However, increased inequality among workers aged in their thirties is the result of family-related career breaks among women and the barriers that women face in attempting to climb the career ladder. Overall, women earn only 66% of men’s average wages in the 30–39 age group.

Pay differences are higher in the private than in the public sector (76% compared with 70% in 2006). This is also the case in domains where women are employed more often or where the proportion of men and women are equal but men traditionally take leading positions – for example, school principals in the education sector and surgeons in healthcare. Consequently, wage differences are high in wholesale and retail trade, financial intermediation, education and healthcare. Pay levels among men and women are almost equal in public administration and defence (where women earn 92% of men’s wages), agriculture (88%) and real estate activities (87%).

By occupation, the pay gap is higher among male and female skilled workers, as well as among legislators, senior officials and managers – in these positions, women’s wages comprise 63% and 65%, respectively, of men’s earnings. However, wage differences are smaller in occupations where women dominate; for instance, wages are almost equal among skilled agricultural and fishery workers, clerks and professionals.

Commentary

The SA analysis concludes that many women work in low salaried and lower ranked positions because it enables them to better reconcile work and family life. Against a background of declining labour market participation among both sexes, efforts should be made to enable better access to work, such as affordable and available childcare options and possibilities for flexible working arrangements.

Kirsti Nurmela and Marre Karu, PRAXIS Centre for Policy Studies