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In macroeconomics, the workforce or labour force is the sum of people either working (i.e., the employed) or looking for work (i.e., the unemployed):
<math>\text{Labour force} = \text{Employed} + \text{Unemployed}</math>
Those neither working in the marketplace nor looking for work are out of the labour force.<ref>Blanchard, O., 2020. Macroeconomics, Global Edition, 8th ed., pag. 154.</ref>
The sum of the labour force and out of the labour force results in the noninstitutional civilian population, that is, the number of people who (1) work (i.e., the employed), (2) can work but don't, although they are looking for a job (i.e., the unemployed), or (3) can work but don't, and are not looking for a job (i.e., out of the labour force). Stated otherwise, the noninstitutional civilian population is the total population minus people who cannot or choose not to work (children, retirees, soldiers, and incarcerated people). The noninstitutional civilian population is the number of people potentially available for civilian employment.
<math> \begin{align} \text{Noninstitutional civilian population} &= \text{Labour force} + \text{Out of the labour force} \\
&= \text{Employed} + \text{Unemployed} + \text{Out of the labour force} \\
&= \text{Total Population} - \text{People who can not work}
\end{align} </math>
The labour force participation rate is defined as the ratio of the civilian labour force to the noninstitutional civilian population.
<math>\text{Labour force participation rate} = \dfrac{\text{Labour force}}{\text{Noninstitutional civilian population}}</math>
Formal and informalEdit
Formal labour is any sort of employment that is structured and paid in a formal way. They are paid formally using payrolls paper, electronic card and alike. <ref name="autogenerated4">Seager, Joni. 2008. The Penguin Atlas of Women in the World. 4th ed. New York: Penguin Books. Part 5</ref> Unlike the informal sector of the economy, formal labour within a country contributes to that country's gross national product. Informal labour is labour that falls short of being a formal arrangement in law or in practice. Labour inherit may come as formal or non-formal, an employee old enough but below retirement age bracket passing on to his children. <ref>Larsson, Allan. "Empowerment of the Poor in Informal Employment." Commission on Legal Empowerment of the Poor (Jan. 2006): 1–10. Print</ref> It can be paid or unpaid and it is always unstructured and unregulated.<ref name="autogenerated2">Seager, Joni. 2008. The Penguin Atlas of Women in the World. 4th ed. New York: Penguin Books. Part 5.</ref> Formal employment is more reliable than informal employment. Generally, the former yields higher income and greater benefits and securities for both men and women.<ref name="autogenerated36">Chen, Martha, Joann Vanek, Francie Lund, James Heintz with Renana Jhabvala, and Christine Bonner. 2005. "Employment, Gender, and Poverty," in Progress of the World's Women, pp. 36–57. New York: United Nations Development Fund for Women</ref>
Informal labourEdit
The contribution of informal labourers is immense. Informal labour is expanding globally, most significantly in developing countries.<ref name="worldbank1">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> According to a study done by Jacques Charmes, in the year 2000 informal labour made up 57% of non-agricultural employment, 40% of urban employment, and 83% of the new jobs in Latin America. That same year, informal labour made up 78% of non-agricultural employment, 61% of urban employment, and 93% of the new jobs in Africa.<ref>Charmes, Jacques. "Informal Sector, Poverty and Gender: A Review of Empirical Evidence." World Development Report (Feb. 2000): 1–9. Centre of Economics and Ethics. Web. 5 Apr. 2011. {{#invoke:citation/CS1|citation |CitationClass=web }}.</ref> Particularly after an economic crisis, labourers tend to shift from the formal sector to the informal sector. This trend was seen after the Asian economic crisis which began in 1997.<ref name="worldbank1"/>
Informal labour and genderEdit
Gender is frequently associated with informal labour. Women are employed more often informally than they are formally, and informal labour is an overall larger source of employment for females than it is for males.<ref name="autogenerated36"/> Women frequent the informal sector of the economy through occupations like home-based workers and street vendors.<ref name="worldbank1"/> The Penguin Atlas of Women in the World shows that in the 1990s, 81% of women in Benin were street vendors, 55% in Guatemala, 44% in Mexico, 33% in Kenya, and 14% in India. Overall, 60% of women workers in the developing world are employed in the informal sector.<ref name="autogenerated4" />
The specific percentages are 84% and 58% for women in Sub-Saharan Africa and Latin America respectively.<ref name="autogenerated4" /> The percentages for men in both of these areas of the world are lower, amounting to 63% and 48% respectively.<ref name="autogenerated4" /> In Asia, 65% of women workers and 65% of men workers are employed in the informal sector.<ref name="autogenerated4"/> Globally, a large percentage of women that are formally employed also work in the informal sector behind the scenes. These women make up the hidden work force.<ref name="autogenerated4"/>
According to a 2021 FAO study, currently, 85 per cent of economic activity in Africa is conducted in the informal sector where women account for nearly 90 per cent of the informal labour force.<ref name=":0">Template:Cite book</ref> According to the ILO's 2016 employment analysis, 64 per cent of informal employment is in agriculture (relative to industry and services) in sub-Saharan Africa.<ref name=":1">Bonnet, Vanek & Chen, 2019</ref><ref name=":0" /> Women have higher rates of informal employment than men with 92 per cent of women workers in informal employment versus 86 per cent of men.<ref name=":1" /><ref name=":0" />
Formal and informal labour can be divided into the subcategories of agricultural work and non-agricultural work. Martha Chen et al. believe these four categories of labour are closely related to one another.<ref name="autogenerated2005">Chen, Martha, Joann Vanek, Francie Lund, James Heintz with Renana Jhabvala, and Christine Bonner. 2005. "Employment, Gender, and Poverty," in Progress of the World's Women, pp. 36–57. New York: United Nations Development Fund for Women.</ref> A majority of agricultural work is informal, which the Penguin Atlas for Women in the World defines as unregistered or unstructured.<ref name="autogenerated4" /> Non-agricultural work can also be informal. According to Martha Chen et al., informal labour makes up 48% of non-agricultural work in North Africa, 51% in Latin America, 65% in Asia, and 72% in Sub-Saharan Africa.<ref name="autogenerated36" />
Agriculture and informal economic activity are among some of the most important sources of livelihood for women.<ref name=":0" /> Women are estimated to account for approximately 70 per cent of informal cross-border traders<ref>UNDP, 2020</ref> and are also prevalent among owners of micro, small, or medium-sized enterprises (MSMEs).<ref name=":0" /> MSMEs are more vulnerable to market shocks and market disruptions. For women-owned MSMEs this is often compounded by their lack of access to credit and financial liquidity compared to larger businesses.<ref name=":0" /> However, MSMEs are often more vulnerable to market shocks and market disruptions.<ref name=":0" /> For women-owned MSMEs, this is often compounded by their lack of access to credit and financial liquidity compared to larger businesses<ref name=":0" />.
Agricultural workEdit
Paid and unpaidEdit
Paid and unpaid work are also closely related with formal and informal labour. Some informal work is unpaid, or paid under the table.<ref name="autogenerated2005"/> Unpaid work can be work that is done at home to sustain a family, like child care work, or actual habitual daily labour that is not monetarily rewarded, like working the fields.<ref name="autogenerated4"/> Unpaid workers have zero earnings, and although their work is valuable, it is hard to estimate its value. Men and women tend to work in different areas of the economy, regardless of whether their work is paid or unpaid. Women focus on the service sector, while men focus on the industrial sector.
Unpaid work and genderEdit
Women usually work fewer hours in income generating jobs than men do.<ref name="autogenerated36"/> Often it is housework that is unpaid. Worldwide, women and girls are responsible for a great amount of household work.<ref name="autogenerated4"/>
The Penguin Atlas of Women in the World, published in 2008, stated that in Madagascar, women spend 20 hours per week on housework, while men spend only two.<ref name="autogenerated4"/> In Mexico, women spend 33 hours and men spend 5 hours.<ref name="autogenerated4"/> In Mongolia the housework hours amount to 27 and 12 for women and men respectively.<ref name="autogenerated4"/> In Spain, women spend 26 hours on housework and men spend 4 hours.<ref name="autogenerated4"/> Only in the Netherlands do men spend 10% more time than women do on activities within the home or for the household.<ref name="autogenerated4"/>
The Penguin Atlas of Women in the World also stated that in developing countries, women and girls spend a significant amount of time fetching water for the week, while men do not. For example, in Malawi women spend 6.3 hours per week fetching water, while men spend 43 minutes. Girls in Malawi spend 3.3 hours per week fetching water, and boys spend 1.1 hours.<ref name="autogenerated4"/> Even if women and men both spend time on household work and other unpaid activities, this work is also gendered.<ref name="autogenerated36"/>
Sick leave and genderEdit
In the United Kingdom in 2014, two-thirds of workers on long-term sick leave were women, despite women only constituting half of the workforce, even after excluding maternity leave.<ref>Template:Cite news</ref>
Globalisation of the labour marketEdit
{{#invoke:Labelled list hatnote|labelledList|Main article|Main articles|Main page|Main pages}} The global supply of labour almost doubled in absolute numbers between the 1980s and early 2000s, with half of that growth coming from Asia.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> At the same time, the rate at which new workers entered the workforce in the Western world began to decline. The growing pool of global labour is accessed by employers in more advanced economies through various methods, including imports of goods, offshoring of production, and immigration.<ref name="IMF07">Template:Cite book</ref> Global labor arbitrage, the practice of accessing the lowest-cost workers from all parts of the world, is partly a result of this enormous growth in the workforce. While most of the absolute increase in this global labour supply consisted of less-educated workers (those without higher education), the relative supply of workers with higher education increased by about 50 percent during the same period.<ref name="IMF07"/> From 1980 to 2010, the global workforce grew from 1.2 to 2.9 billion people. According to a 2012 report by the McKinsey Global Institute, this was caused mostly by developing nations, where there was a "farm to factory" transition. Non-farming jobs grew from 54 percent in 1980 to almost 73 percent in 2010. This industrialization took an estimated 620 million people out of poverty and contributed to the economic development of China, India and others.<ref name="MGI12">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>
Under the "old" international division of labor, until around 1970, underdeveloped areas were incorporated into the world economy principally as suppliers of minerals and agricultural commodities. However, as developing economies are merged into the world economy, more production takes place in these economies.<ref name="EncylG">Template:Cite book</ref> This has led to a trend of transference, or what is also known as the "global industrial shift ", in which production processes are relocated from developed countries (such as the US, European countries, and Japan) to developing countries in Asia (such as China, Vietnam, and India), Mexico and Central America. This is because companies search for the cheapest locations to manufacture and assemble components, so low-cost labor-intensive parts of the manufacturing process are shifted to the developing world where costs are substantially lower.
But not only manufacturing processes are shifted to the developing world. The growth of offshore outsourcing of IT-enabled services (such as offshore custom software development and business process outsourcing) is linked to the availability of large amounts of reliable and affordable communication infrastructure following the telecommunication and Internet expansion of the late 1990s.<ref name=Telcom.out>Template:Cite book</ref>
See alsoEdit
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ReferencesEdit
SourcesEdit
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