The financial crisis and the impact on women – Part 1

Posted: September 4, 2011 in Uncategorized

(An interesting article from Socialist Voice, newspaper of the CP Ireland – ed)

Dr Magdalena Sepúlveda Carmona, the UN independent expert on human rights and extreme poverty, conducted a five-day visit to Ireland in January this year to examine and report back to the General Assembly and the Human Rights Council on the current situation in Ireland. Her report concludes that the “economic and financial crises have wrought havoc on the country, with grave implications for the Irish people.”
While criticising the Government for imposing cuts in public expenditure, she went on to say that “reductions in public expenditure affect the poorest and most vulnerable with the most severity.”
The current economic and political crisis has indeed had a dramatic impact on Irish society. Unemployment is rising, and increasing numbers of people are living in poverty and social exclusion.
As in all economic and political crises, the impact varies enormously on different strata within societies. The crisis in Ireland poses a disproportionate threat to vulnerable groups in the country who benefited little from its so-called Celtic Tiger economic boom. The communities most disproportionately affected include children, single parents, people with disabilities, migrants, Travellers, homeless people, the working poor, people living in rural areas, and refugees and asylum-seekers.
The human rights expert expressed particular concern about children, especially in single-parent households. “The substantial cuts in child payments and services in recent budgets can exacerbate their situation, leading to an increase in the worryingly high child poverty rates. This would represent a major step backward for Ireland.”
In 2008/09 Ireland was rated among the ten richest countries. Yet even in those years widespread poverty existed among certain groups. During the period of economic boom the gap widened between the rich and the poor.

Women and the labour market

Let us remark that the nature of capitalism itself has changed. The stagnation of the “real economy,” based on manufacture, with its constant crises of overproduction, led to the absolute dominance of finance capital, which produced a series of speculative bubbles on a grand scale, its nominal funds totalling ten times the value of world production.
There were massive structural, material and ideological consequences for society, including a rise in individualism and a decline in collective consciousness, especially class-consciousness.
As the economic environment has clearly become harsher for workers, with previous so-called austerity budgets culminating in the budget of December 2010, Government policy manifests itself in savage cuts in public spending, in social welfare, children’s allowance and public-sector workers’ pensions on top of a savage assault on jobs in the private sector and all the other measures designed to make working people and the poor pay for the financial crisis of the state and the banks.
The first wave of job losses was mainly concentrated in the construction industry and associated manufacturing. The collapse in the construction industry resulted in a huge increase in the number of male workers signing on the live register. The second wave of unemployment was in light manufacturing and in the service sector, which is predominantly women’s employment, and these sectors are also characteristically low-paid. This was followed by a savage attack on public-sector workers’ pay, where again there are a significant number of women employed in the lower-paid grades. Many of these saw their pay cut by more than 20 per cent.
But this is not the complete story. Cuts in welfare, threats to wage-setting agreements for low-paid work and the rolling back of public services are all having a severe impact on women in Ireland and throughout Europe.
In Ireland the impact of the austerity budgets on women did not feature in any mainstream analysis, yet the cumulative cuts of nearly 10 per cent in widow’s pension, one-parent family payment, and the carer’s allowance, the cuts of 8½ per cent in child benefit, and the reductions in services and public-sector pay, have all affected women more heavily than men.
But what does this mean for the everyday life of women? And to what extent do these cuts contribute to inequality?

Pay rates

Coupled with rising unemployment and cuts in benefits and public expenditure, pay rates in Ireland are also under further attack. The Government has commissioned a review on the workings of the joint labour committee (JLC) process for setting the wage rate in certain low-paid industries.
The argument from employers is that the JLC rates act as a barrier to job creation and retention. The Duffy-Walsh review concluded that lowering the JLC rates to the level of the minimum wage is unlikely to have a substantial effect on employment. However, it looks as if the minster is attempting to plough ahead and will seek to reform or dismantle the JLCs. Ending the JLC process would lead to a reduction in wages for the lowest-paid workers, particularly female workers, and result in a dramatic increase in the number of workers and their families who would be forced to live in poverty.
The link between income and poverty has been well established, not only in Ireland but throughout the European Union. According to the European Anti-Poverty Network, “women across Europe are more likely than men to experience poverty, and single mothers, older women and immigrant women are particularly vulnerable.”

The second part of this article will be published in the October issue of Socialist Voice

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