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Reanalyzing the gender-specific effects of the Great Recession

Khalil, Sana (2018): Reanalyzing the gender-specific effects of the Great Recession. Published in: The Political Economy of International Finance in an Age of Inequality: Soft Currencies, Hard Landings, (2018): p. 47.

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The subprime mortgage crisis that began in the United States eventually unraveled as the worst global economic crisis – the Great Recession – since the Great Depression of the 1930s. The literature has described several factors to explain the causes of the Great Recession, most prominent being the pace of financial deregulations and excessive financial innovations that catalyzed an unnatural boom that ended in a crisis (Crotty and Epstein, 2009). Countries hit the hardest in terms of an upsurge in unemployment rates over 2008–10 include Denmark, Estonia, Greece, Iceland, Ireland, and Latvia. A comparison of harmonized unemployment rates for these countries shows that Estonia posted the highest increase in the unemployment rate, which rose from 5.5 percent in 2008 to 16.7 percent in 2010, an increase of 203 percentage points. Other countries worst hit by the crisis were Iceland (153 percent), Latvia (151 percent) and Ireland (117 percent) (OECD, 2018a). To this end, an important but understated issue worthy of discussion concerns the gender impacts of the Great Recession. Crisis theories that have described its distributional dynamics do not converge to a united whole and predict differential impacts of crises for men and women. One theory posits that since women are used as employment buffers – called in when demand increases but pushed back when demand shrinks – women’s unemployment rates may rise more than that of men’s during recessionary phases. Thus, women might experience a greater loss in employment, earned income, and overall wealth during recessions (Humphries, 1988 [2010]). However, an argument running counter to this theory is that women’s concentration in female-dominated occupations – which tend to be cyclically robust – may shield women’s employment relative to that of men’s. Since there is no definitive theoretical model of these relations, the issue of the gender impacts of recessions becomes an empirical question. In this respect, men’s and women’s labor market experiences from the Great Recession can be treated as a litmus test. Similar to previous two recessions in the US, men’s unemployment rates rose faster than women’s during the Great Recession. Due to this phenomenon, these recessions have come to be known as “man-cessions” (Wall, 2009). However, I argue in this chapter that this observation can be misleading on many accounts. I argue that although men and women showed substantial differences in their vulnerabilities to the recession, within-gender differences were much more pronounced. Additionally, gender impacts of crises derive from differences in men’s and women’s unique, socially and culturally drawn positions, job structures, family models and welfare systems.

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