Nordic Lessons to Raise Female Labor Participation in NE Asia

Shift women from non-regular to regular employment to boost their labor participation

Child cash allowances, gender wage gaps discourage women from regular employment

More regular female employment associated with higher fertility

Women would be more likely to remain in the work force if they were in full-time jobs enjoying all the associated benefits, rather than in part-time employment or contractual workers with only partial benefits, says the paper.

The findings of the report entitled “What Can Boost Women’s Labor Force Participation in Asia?”, were discussed at a seminar hosted jointly by the IMF’s Regional Office for Asia and the Pacific and the Organization for Economic Cooperation and Development. The launch, in Tokyo earlier this week, brought together policymakers and academics who exchanged views on the measures needed to encourage women to enter and remain in the work force.

Finland and Norway set an example

Taking the example of Finland and Norway—forerunners of gender equality with high female labor force participation and relatively high fertility rates—the paper shows that public policies in those countries, such as parental leave and provision of childcare facilities, have not only increased the number of working women, but also led to them having more children.

Faced with a rapidly aging population, the governments of Korea and Japan have made increasing women’s labor participation an important pillar of their reform programs. But balancing work and family remains a challenge for women, not only in these two countries but throughout the world.

Gender wage gap discourages female workers

Although the number of working women in Japan and Korea has been rising, it is still lower than the average for advanced OECD countries. Part of the reason for this might be the large difference in wages between men and women.

In Korea and Japan, the wage gap between men and women is the highest of all members of the OECD. Women earn, on average, about 26 and 37 percent less than men in Japan and Korea respectively. Their fertility rates are also among the lowest of OECD countries.

In contrast, Nordic countries have both high female labor force participation and fertility.

Women’s M-shaped employment pattern

More than half of the total female labor force in Japan and Korea is in low-paid non-regular employment with a low chance of career progression. This is partly because women often drop out of the labor force at a prime time...