Trends of Poverty in Iran with Gender perspective

Introduction

Iran has been seriously confronted with combined socio economic problems, for more than twenty years. Among major factors of growing poverty in the 80s is the high population growth rates reaching to 3.9% (3.2% from natural increase and 0.7% from immigration of Afghans and Iraqis) the revival of the national family planning program which was delivered through a nationwide network of primary health care facilities with the aid of vast numbers of trained local women public health promoters. Currently Iran’s population growth rate dropped to 1.2 percent a year. More over, as the system of the government, it is governed by the policies which are not based solely on economic decision, short term economic policies, high inflation (between 20 to 40 %), small share of private sector in national economy (15 %), and institutionalized monopolizing behavior have made economic participation for private entities particularly for women difficult and has pushed women to informal and unprotected economy. The short term governmental economic policies have brought uncertainty and high risk for the private sector and individuals to be active in economy and carry out their entrepreneurial inititive.

The other major factor impediment to economy is the low labor productivity level and growth rate coming from inconsistent socio economic policies and management as well as over reliance on rent structures rather than hard work and value added. Sustained high levels of inequality, poverty and vulnerability for a large proportion of the population has been the result of allocating lion shares of public budget to State owned foundations and corporations. Significant differentials between private and social costs and benefits along with continuing to subsidize consumer goods instead of investment on industrial and development infrastructures and supporting competitive private sector to promote the growth are among the key issues. Subsidies, which have been both vast and ranging but untargeted, have resulted in an economic distortion. The rich are continuously gaining more than the poor. In the subsidies policies, we come to this conclusion that lowest percentile benefit only 3.8 per cent, while tenth percentile benefits as much as 20.5 per cent. Therefore top percentile benefits 5.4 times of the lowest percentile. This method has resulted in the smuggling of subsidized goods to neighboring countries through illegal actions. Excessive rent seeking and short term behavior and over reliance on oil exports revenues which is the source of 80% of the country’s export income is also among factors that enforce unjust asset distribution through out the country. Disaggregated data are even more revealing of the discrepancies. The HDI shows high dispersion amongst provinces while the gender adjusted HDI shows an even higher dispersion.

The low employment ratio and lower participation rate of total labor force in comparison with most of the countries; in addition to the lower than average female labor force participation (FLFP) and their participation in its political process are two key characteristics of Iranian labor market. Low rate of women’s participation affected the total labor force participation where the gap in employment rates amounts to almost six times privileged for men. Stereotyping and limited job options for employment in service and education sectors are among socio/cultural factors hampering women’s wider participation in economy. The society should be able to accept women in trade, women in the police force, etc. Otherwise, their opportunities would be restricted to teaching, nursing, clerical work, in lower positions, and to women exclusively with top levels of university education. Giving women equal opportunities to contribute to economic life would significantly enhance the growth prospects and economic productivity of the countries. Women are also active in jobs such as hairdressing, baking cookies,, mass production of handicrafts and sewing. However, these jobs are marginalized to informal sector and as such, no official statistics exist for a quality research. Middle class, lower income groups, urban and rural women, who are engaged in these activities, do not have means and machinery to organize their associations or unions. One of the reasons Iranian women engage mostly in informal economic activities, is that they can combine it with their routine household duties. On the other hand, often the income is higher than official wage and women are not restricted to be present in an office for long hours.


Rise of Level of Education

World Bank analysis reveals that if the female labor force participation rate increased in accordance with education levels and age structure, household earnings could rise by as much as twenty-five percent. For many families, this is the only way to step out of poverty vicious circle, which demonstrates the instrumental role that women play in lifting their families out of poverty and influencing the larger socio-economic climate.
The prospect of increasing economic participation by women are anticipated for Iranian female workers due to rise of level of education, delayed marriages and climb of average marriage age, changes in population age structure, decrease of fertility rate, changes in customary gender roles in households and stereotyping. Studies show that the increasing cost of living requires women to participate in economic activity to overcome poverty.

The slight share of compulsory education and further development in household expenditure according to the Statistical Center of Iran and the Central Bank indicates that the Government bears a considerable share of the cost of education and training of human resources in Iran. However due to structural constraint of private sector to meaningfully engage in national economy the massive brain drain has brought a total loss for the government in its investment in education. Moreover the recent accelerated trend of poverty among literate headed households in different levels of education can be associated with over supply and the rising of unemployment among educated women. On the supply side in recent years, the increase in the female participation rate and the rapid improvement of the educational profile of the labor force brought in to the labor market a large number of mostly young, well qualified female workers. These developments took place at a time of significant restructuring and slow down in the pace of economic growth in Iran and as a result the unemployment rate will likely continue to increase. On the other hand the analysis of poverty trend on the basis of literacy of the head of household indicates that illiterate women in both villages and cities have always been exposed to poverty much more than educated women. In 1991, 47.5 per cent of illiterate women were head of poor households. This ratio has been 72.2 and 27.8 per cent respectively for women in urban and rural areas.

In urban areas the rate of unemployment for educated women raised to 31.5% while for other urban women this figure stays at 18.1%. The unemployment for educated women will see accelerated rise in future due to lack of effective job creation policies.Women’s share of total employed is approx. 14.8% but their share of most recent employed has increased to 24.2%. The government estimates that to bring down unemployment it would need about 700,000 new jobs every year for the next five years. Yet employment creation has not been sufficient to meet the rapid increase in the labor force, inflation is high and rising again, price subsidies and controls continue to hinder economic efficiency, and structural impediments for private sector development remain unchanged.





Women household heads

The census in Iran is concerned with family units and not individuals. Therefore in the majority of conducted studies, poverty among female headed households is analyzed as women’s poverty which has multi–dimensional aspects. In all developing countries women’s poverty is of chronic type, stemming out of social and cultural factors entanglement. The situation of women, and in particular the 1.3 million women headed households (Iran Statistics Centre 1997), is particularly vulnerable. Statistics further indicate that 9% of all women bearing the burden as head of households. Labor regulations and family laws in Iran reinforce the traditional family model, making women financially, legally and socially dependent on men. The responsibility of male figure of the household as the sole bread winner is clearly marked in the Constitution. In 1996, each employed person had to provide for the living expenses of 4.2 persons, which would cause the reduction of the level of savings of households hence the national savings. On the other hand, the commonly held belief that in situations of unemployment women would take away jobs from men was not confirmed by the researchers. Evidences point out to job opportunities created by economically active women who work out of home while they use other services to fulfill their homemaking tasks.

The majority of the researches have concentrated their attempts to determine poverty line based on income (expenditure) poverty line due to scarcity of data. One of the restrictions of statistics is that, expenditures are determined and defined collectively for the household, so there is no information about the allocation of expenditures among family members, men, woman and children. In this regard, the verification of poverty and deprivation among women in families is not possible. Considering this limitation for the verification of poverty based on gender, the gender of the family bread-winner is the measure and the degree of poverty among families whose bread–winners is a woman (women headed households), has been analyzed in accordance with economic and social and geographical situation.

Women household heads had a consistently higher percentage of poverty than men; however the gap between the two groups recently decreased over time. The gender sensitive poverty analysis shows that being a woman as head of household increases the possibility of falling in absolute poverty. In 1991, 1996 and 2001; 45.4per cent, 52 per cent and 17.5 per cent of all female headed households successively did not earn the minimum levels and ended up living in absolute poverty. While the same figures for men were 25.4 per cent, 16.1 per cent, and 14.8 per cent. The results of sampling indicate descending trend of poverty among women compared to men, however, the share of poor women has always been larger. In the period 1991 – 1996, poverty among women had increased but during the next interval (1996 – 2001) the situation of female headed households did in fact substantially improve.

In an economic analysis the high percentage of poverty among aged head of households, has been regarded as an indicator of inefficiency of relief and insurance organizations, as well as social security systems - despite having sufficient budgets - and lack of optimal use of their savings. Female labor participation is the only entering point into the social security system of the country. The policies which increase inflation can also be highly significant in the increase of this ratio and worsening the intensity of poverty.


The health dimension

In Health while Iran has a well performing basic health system and good health indicators, it still has a high rate of childhood malnutrition. In recent researches the widespread issue of iron deficiency among women and girls - and 2.5 Cm reduction of the height of children particularly girls were revealing the issue of malnutrition.

Women’s life expectancy increased by ten years since 1980, largely due to better healthcare and a fall in maternal mortality. Yet gains in women's health and education, with as much as 65 percent of university students being female, have not translated into commensurate gains in employment. Even though there was great success to avail education for girls and women as well as the growth of literacy, creating jobs and promoting employment opportunities for educated at all levels is indispensable for elimination of poverty among women. Based on the 2002 census (Statistical Center of Iran) results, the size of the average urban household in 2001 was 4.47 persons. The average number of employed persons per family was 1.1 persons and the average number of income earners was 1.4 persons.
Based on the latest statistics in 1991, about 27.4 per cent of sample families were living under poverty line. This ratio had decreased to 18.8 per cent in 1996 followed by 15.3 per cent in 2001. As the result, annually, an average of 5.6 per cent of families has been able to get disentangled from the vicious cycle of absolute poverty. The pace of poverty reduction in the first period can be attributed to the post – war conditions. Indicators under study relevant to health and medical and education endorse slight improvement in poverty reduction and anti discrimination policies while in job creation and housing the improvement acquired was negative.

Increasing the economic capacity of women has undoubtedly been a key factor in improving their status. However, as men are unwilling to take on traditionally female roles, the women are overburdened. The family arrangements are still quite unequal in terms of sharing the burden of housework and child care. Studies show value added for food preparation usually carried out by women in the period 1984 – 1995, could increase GDP by 10 per cent. Using the method in which value added is accounted as work of equivalent value and according to cost substitute - the figure for food preparation would come up to 15.4 per cent of GDP in 1994.




Poverty in Rural/Urban Household

Women in the agriculture sector are economically under privileged due to the fact that 54 percent of employed women in this sector are family and non-wage workers (Statistical Center of Iran, 2001). In rural areas, research is needed to find the causes that women often earn less than men in agriculture and what factors lead women to be less productive. Women farmers often find it difficult to adopt productivity enhancing their access to technology. Traditionally they are less likely to demand rights to land and control over their asset. The Statistical Center’s annual samplings in the last decade show lower living standards in rural areas compared to urban. The annual average gross expenditures of rural to urban household have been 55.4, 60.1 and 61.5 per cent successively, in the years, 1991, 1996 and 2001. As a result, the household expenditures for rural family stand for 55 to 65 per cent of that of urban areas on average.

The ratio of rural population of the country has decreased from 42 per cent in 1991 to 38 per cent in 1996 and continued to decline to 36 per cent in 2001. The increase of the poverty percentage among jobless heads of household in urban areas compared to rural areas resulted from the immigration of the young men from villages to cities in the expectation of finding a better job and income. Due to the fact that they are unsuccessful at the early stages to find a job, this trend will entail the increase of number of the poor unemployed. The poverty index in rural and urban societies implies that poverty has decreased in urban areas from 36.6 (1991) to 17.6 (1996) and further decreased to 15.2 per cent in 2001. The mentioned descending trend also holds true in rural areas. Poverty in rural areas droped to 20 per cent and later to 15 percent in 1996 and 2001 respectively from initial figure of 18.2 per cent in 1991.

In the agricultural sector, the level of poverty among female household heads was higher than the average relative poverty levels among men and women. According to data, women labour force in agricultural sector is estimated around 40 per cent. Studies show more than 82.5 per cent of rural women do participate in some sort of income generation activities at home or work place. Only 51 per cent of rural women generate income, meaning 49 per cent of women are not able to earn income whether or not they participate in economic activities. They are considered as housewives in categorization of the Iran Statistic Centre.

Dividing the percentage of poverty among jobless to urban and rural, certain verifying points emerge for further analysis. The percentage of poverty in urban and rural areas among families with unemployed head of households in 1991 was 48.6 and 24.6 per cent respectively. These rations changed to 27.9 and 31.8 in 1996 and 2001 in urban areas, whereas the percentage of poverty in rural areas with unemployed head reached 28.3 and 26.4 per cent. On the other hand, among employed household heads in urban areas the percentage of poverty was 32.3, 14.2, and 14.8 per cent respectively in 1991, 1996 and 2001, whereas the same figures for villages were 16.7, 15.7 and 13 per cent successively.

The percentage of women in the first tenth percentile is between 27 per cent and 36 per cent while in the ninth and tenth tenth percentiles, it does not exceed 7 per cent. In most cases, the share of women in latter two tenth percentiles is between three and four per cent.

Approximately 31 per cent of urban homemakers and 54 per cent of rural homemakers were in the first twentieth percentile. The significant gap between urban and rural dwellers can be due to the greater opportunities for urban households to rely on other active (those who are employed) members in the family. In fact, the number of employed persons per household is the key factor for escaping the poverty.

The urban unemployed identify themselves as unemployed, yet they have a variety of short-term opportunities in small-scale or informal commerce, transport of passengers and other financial activities at their disposal, which probably enables them to secure their livelihood to a certain extent. Such opportunities are much less available in rural areas. The same situation holds also true regarding homemakers.

Examining the economic activities of household heads by economic sector reveals that employed persons in the agricultural sector hold the highest share in the first and second tenth percentiles (approximately 32 per cent). Employees in the industry and mines sector compose approximately 25 per cent of this twentieth percentile. Employees in these two sectors are in a more precarious situation than those in the other sectors. Agricultural workers compose 10 per cent and industrial and mines workers compose 16 per cent in the last twentieth percentile.

In the service sectors, those who work as financial intermediaries or “middlemen” are the most prosperous. Approximately 91 per cent are in the fourth and fifth twentieth percentiles and only 9 per cent are in the second twentieth percentile. Employees in the construction sector compose 14 per cent of the first twentieth percentile and they have similar compositions in the twentieth percentiles that follow. As the twentieth percentiles increase in prosperity, the share of employees in the trade sector increases as well. The same make-up can be observed in the transportation and communications sector. The share of these sectors in the upper twentieth percentiles is 28 per cent and 29 per cent respectively.


Access to Financial Resources

The laws of inheritance and the policies on micro credits have limited the access of women to financial resources as banks do not promote lending without collateral. Women’s lack and poorly enforceable rights over property in the labor market and in the home means that they are more vulnerable to poverty than men. The contingent nature of women’s rights over resources and property, often secured through family or marriage ties, means that even women in wealthy households are vulnerable to poverty, especially in the event of separation, divorce, widowhood or other household breakdown.

Because women are less mobile than men, banks are harder for them to reach; more women than men are illiterate, making documentation difficult, and majority of women lack collateral. In addition, since women have been less present in the economic sector, their entrepreneurship power and skills are less improved. All these factors also make greater income gap between men and women in the traditional part of the economy. In the higher education the gap is created gradually, through fewer opportunities of job promotion and additional advantages available for men. The fact that men have monopolized linking and lobbying with high ranking power players has limited access of women to higher positions and made it exclusive to men; or at best through middle men. Stereotypical prejudgements about female emotional and behavioural characteristics preclude the progress of women in the organizational hierarchy.

Families who are engaged in small businesses have increased their income, are less dependent on government assistance, and have more secured food. Through the marketing research, poor producers, men and women who would like to be engaged in small businesses should be able to get knowledge and professional advice on effective business management, community funds establishment, and better access to local and regional markets.

The effectiveness of the social security programs considering variety of risks, efficiency, and coverage are under question. For instance, old age pension per capita for a 5 members household and more in support services in 2001, was between Rls. 60.000 and Rls. 150.000, which is concerned only to cover less than 20 per cent of the basic household needs.

In general, social ills such as smuggling, drug addiction, escape of young girls from home, prostitution, selling body parts, etc. are drastically increasing. In issues regarding drug abuse, the problem can be reviewed from two aspects: demand and supply. Demand for narcotics comes largely from the unemployed, deprived and powerless whose share of the addict population is much higher than their share in the society at large. Escaping from decay, despair and deprivation is considered as the main cause of seeking relief in drugs.

Prostitution and trafficking of women with few exceptions, is initially associated with poverty and deprivation even when there is consent. Studies in and about street girls, teenage prostitution and women smuggled to Dubai demonstrate this stark reality. Similarly, youth delinquency, increase in street children and child labour (presently about 550,000 children below 15 working in Iran) are undoubtedly related to poverty, deprivation and broken homes.

Of crucial importance, though often ignored by officials, is the fact that, increase in vulnerabilities and social upheavals emerges in the wake of poverty compounded by injustice, unfair distribution of income and discrimination. Structural adjustment policies for more than a decade have resulted in severe inequality of income and wealth, increased the likelihood of widespread financial abuse, and further cemented the lack of democratic controls over management. Together they have contributed terribly to social problems and the regrettable state of affairs.

In conclusion, ineffectiveness of the social security system and its supportive programs are less due to scarcity of financial resources and mostly are the outcome of improper budget allocation, mismanagement and lack of systemic approach. In this respect, ignorance of NGOs in relief and aid delivery is significant which has to be seriously addressed.

One of the priorities in the country’s future macro-economic policies will be paying greater attention to policies that stimulate economic growth on the condition that deprived and poor households can derive benefits from such growth.


Reducing Barriers to Economic Opportunities

Women’s economic participation is considered one of the elements of the sustainable development therefore endogenous, durable and new development plans tend to attract women as a partner in production activities. Economists affirm that female awareness and education has a higher social return because of the important role educated women play in promoting well being of others. It is agreed that women participation in labor force will maximize social output, which can also justify governments investing more in women’s education, than in men. At the margin, additional income in the hands of women results in a larger share of the household budget going toward nutrition, health, and education. The greater the woman’s control over household resources, the greater is the share of resources devoted to children (WB, Gen & Dev Report, 2003, 72).

Target planning for providing subsidies, in addition to capacity building and empowerment of the poor instead of providing livelihood, along with effective macro economic policies for long-term are recommended for future to alleviate poverty. The review of the legislative environment to ensure that women benefit from equal rights granted under the constitution; a supportive infrastructure such as better child care, transport, water and telecommunications to facilitate women's participation in the public sphere; continued attention to education, particularly to provide women with relevant market skills; and reform of labor laws and regulations to reflect the new demands and development model and the need for job creation in the private sector particularly promoting entrepreneurship among women.

Promoting entrepreneurship: policies to encourage female elites and entrepreneurs are the key to eradicate poverty, in addition to improving the tourist industry and small business for women’s participation in food or textile industry; providing support for women NGOs; engagement in innovative projects for environment preservation; removal of gender inequalities in decision making process are recommended to further improve women’s status.


NASRIN AZADEH



References:

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