BOSNIA AND HERZEGOVINA PROMOTING WOMEN’S ACCESS TO ECONOMIC OPPORTUNITIES Policy Note Key Messages Prospects for faster, more sustainable economic growth and higher living standards in Bosnia and Herzegovina rely on increasing employment opportunities for all. By maintaining the current structure of labor participation, Bosnia and Herzegovina is not capitalizing on its educated young population, as only 22.7 percent of 15–64-year-old women are actively contributing to the economy through employment. Closing gender gaps in access to economic opportunities requires removing the existing barriers and disincentives to employment and entrepreneurship for women. These include: (i) improving access to assets and productive inputs, (ii) providing access to child- and eldercare, (iii) eliminating disincentives and barriers embedded in labor taxation and regulation, and (iv) increasing the employability of women through effective active labor market policies and adequate skills and training. Cross-cutting policies around social norms and discrimination, better access to information, and improved monitoring and evaluation systems are also important. This Policy Note was produced in 2017 by the World Bank to summarize the relevant policy areas in tackling gender gaps in access to economic opportunities in Bosnia and Herzegovina. It was prepared by a World Bank team from the Poverty and Equity Global Practice unit that included Paola Buitrago, Maria E. Dávalos, Ana Maria Munoz Boudet, and Lourdes Rodriguez. Context women compared to regional averages in Europe and Central Asia (ECA), the gender gap is much larger (figure 2). 1 The labor market is also characterized by a high Bosnia and Herzegovina has made progress in degree of informality at roughly one-third of total promoting equity between men and women, but gaps employment. 2 remain, particularly in access to economic opportunities. Observed gender gaps in employment Gaps are observed in entrepreneurship as well, as only (19 percentage points among 15–64-year-olds) are 24.1 percent of firms have a woman as manager and driven by gaps in labor force participation (23 only 9.3 percent include female participation in percentage points in 2015), namely, the low ownership, 3 higher than the regional average in the participation rate of women, which, at 43 percent, is 19 case of female management but lower in the case of percentage points lower than the European Union (EU) female ownership. Female-owned businesses on average. This gap persists throughout the life cycle average are smaller in scale than those owned by men (figure 1). Moreover, although labor force participation in terms of sales, costs, employees, and volume of in Bosnia and Herzegovina (BiH) is low for both men and 1 World Bank, “World Development Indicators” (database), 2016, 3 European Bank for Reconstruction and Development, Business https://data.worldbank.org/products/wdi. Environment and Enterprise Performance Survey (BEEPS), 2013. 2 World Bank (2016a). profits, but they are just as likely to be profitable as education, or training (NEET) (27.7 percent, roughly male businesses once women establish themselves as twice the EU average). This labor market detachment, entrepreneurs. 4 more prevalent among women, delays or prevents the accumulation of valuable on-the-job skills. Since these For those in the labor market, it is estimated that “scarring effects” from unemployment and periods of women earn 9 percent less than the average hourly inactivity often translate into lower productivity and wage of a male worker. Men generally earn more per human capital accumulation later in life, women can hour than women across all levels of education and age find their upward economic mobility prospects groups, with a few exceptions, such as in the fields of substantially impaired, which in turn affects the agriculture and mining, real estate, and administrative country’s future economic growth potential. In fact, for services. 5 What is more, unemployment rates are BiH, differences in labor market activity rates between higher for women compared to men (31.3 versus 26.3 men and women amount to potential economic losses percent, respectively). Segregation in fields of study— in gross income per capita of roughly 16 percent. 7 young women tend to concentrate more on certain areas such as health, education, and humanities and arts) also influences women’s labor market prospects. Addressing the Challenges to Gender Equality Among ethnic minorities, gender gaps exist even in outcomes for which the country has, on average, Closing gender gaps in access to economic achieved some measure of equality, such as education. opportunities requires removing the barriers and For instance, one survey reveals that Roma women disincentives to employment and entrepreneurship have around 3.9 years of education, one-third that of that women face. A number of steps are needed to non-Roma women. Similarly, unemployment among ensure progress in this area, including improved access Roma women is estimated to be twice as high as among to assets and inputs, better access to child- and Roma men and also higher than among the non-Roma eldercare, fairer labor taxation and regulation policies, population. 6 and enhanced labor market skills and training. Figure 1. Labor Force Participation by Gender and Age Groups, 2015 Access to Productive Inputs 100 The lack of access to productive inputs such as land or 80 credit constrains women’s economic opportunities, 60 particularly as entrepreneurs. % 40 Recent data reveal that women’s participation in 20 property ownership is very low in BiH. Only 26.8 percent of property owners—i.e., with property registered in 0 their name—are women, compared to 73.1 percent 15-24 25-49 50-64 65+ who are men. This situation has been relatively Male Female constant over the past decade, as between 2003 and Source: Authors, using BiH Labour Force Survey (LFS), 2015. 2013, approximately 70 percent of men have owned property, a period during which ownership among women increased by only 3 percentage points. 8 Of particular concern is the high rate of BiH’s young people aged 15–29 who are not in employment, 4World Bank (2011). 7 Cuberes and Teignier (2015). 5World Bank et al. 2015. 8 FAO and World Bank (2014). 6 UNDP, World Bank, and EC (2011). Figure 2. Labor force participation rate (population ages 15-64) Sources: World Bank, “World Development Indicators 2015” (World Bank, Washington, DC: 2016); data for Kosovo from 2014 LFS. Although the civil code protects women’s right to In terms of access to finance, more men than women property ownership in BiH, prevailing discriminatory have an account at a financial institution (58.8 traditions and social norms undermine this and other compared to 47.1 percent). Although gender gaps are basic rights, especially for women in rural areas. small in the share of men and women who attempt to Moreover, women often lack information about their borrow money to start, operate, and/or expand a farm rights and the services to use for guidance and or a business in BiH, such loans are very low for both information. Even when women do legally own land, it sexes (2.7 percent for men and 2 percent for women). is often regarded as family property and thus not In fact, the most widespread source of business capital appropriate for women to have the right to administer for both women and men is personal savings, followed it. 9 by inheritance, with very low usage of bank credit. 11 A forthcoming World Bank survey of male- and female- Women therefore face obstacles not only in using land owned micro and small enterprises in BiH will provide a or other property to develop a business but also in more detailed assessment of the financing gap and its accessing financial markets due to the absence of relation to gender in BiH, with relevance also to other collateral. In practice, women frequently have difficulty countries in the region. obtaining credit because they do not own property to serve as security; even when they receive loans, they Access to Child- and Eldercare are usually smaller than those taken out by men. 10 Another fundamental barrier to women’s economic participation is the usually competing demand on their Co-operation and Development (OECD) 9 Organisation for Economic 10 World Bank et al. (2015), using data from Mi-Bospo and IFC Social Institutions and Gender Index (SIGI), (2008). http://www.genderindex.org/country/bosnia-and-herzegovina. 11 World Bank, “The Global Findex Database,” 2014, http://www.worldbank.org/en/programs/globalfindex. time to care for family members. This generates a The rising demand for formal care services and vicious circle of low labor market attachment and relatively progressive views about their use in BiH prominence of the care provider role that leads to provide an opportunity for the development of a formal women’s increased economic vulnerability and other care industry that could increase labor force gender-based inequalities. Low enrollment rates in participation and productivity. preschool education in BiH reflect limited working time for parents, particularly women. The latest data Labor Taxation and Regulations available show that the gross enrollment rate for pre- primary children (aged 3–6) is 17 percent. 12 Labor taxation and regulations also affect women’s incentives to work and firms’ incentives to hire them. 13 Three critical messages emerge from a recent World Bank assessment of the supply of and demand for The structure of labor taxation, in combination with the formal child- and eldercare in BiH: design of social benefits, can lead to disincentives to work. In neighboring countries in South East Europe 1. Childcare: The relatively low utilization of formal where there are available data, part-time/low-wage childcare services is driven by the limited availability of earners face higher effective tax rates than average affordable services. Evidence shows that there is an wage earners. 14 As women are more likely to be unfulfilled demand for formal childcare services, overrepresented in these groups, this could result in predominantly from parents who see a benefit for their disincentives among women to seek work or among child’s development and from mothers who are already employers to hire them. This analysis is not available for working or willing to work but who have little or no BiH, but it would clearly be a worthwhile topic to informal childcare support. Although BiH looks explore. relatively progressive in terms of social perceptions of childcare, work, and motherhood, norms tend to Moreover, certain regulations disproportionately affect contribute to negative views about the use of childcare women’s employment, including in such areas as centers. flexible work arrangements and family leave provisions. In BiH, only about 3 percent of workers are employed 2. Eldercare: The supply of eldercare is characterized by part-time, which is significantly lower than the EU the lack of day-based services and the limited number average of 20 percent. 15 and expense of residential care centers. Social norms are a strong deterrent to the use of residential The design of family leave provisions, especially eldercare, suggesting that the use of daycare centers maternity leave, could also increase employers’ and home-based formats—if they were available— disincentives to hire women. There is no international would be more compatible with prevailing standards. standard for the design of family leave policies, with different approaches based on length, portion paid and 3. Quality is important to the potential users of formal unpaid, level of wage replacement, and source of care services. With regard to childcare services in BiH, funding. The length of paid maternity leave in BiH—the the biggest challenge appears to be ensuring quality main paid leave available for parents—is high (365 standards, particularly in the areas of human resources, calendar days) compared to both global and regional materials, and curriculum; for eldercare, the main averages (more than double the global average and the challenge is in the human resources component (staff second highest in the ECA region) and to averages in training and qualifications). countries with similar income levels. When adjusting the length of maternity leave by wage replacement (at 60 percent in BiH), it remains high compared to the 12 UNICEF, “Monitoring the Situation of Children and Women” 14Ibid. (database), 2016, https://data.unicef.org/country/bih. 15 ILO, “Key Indicators of the Labour Market (KILM)” (database), 13 Arias et al. (2014). http://www.ilo.org/ilostat; Labour Force Survey (LFS), 2015. region. 16 Nevertheless, since the government fully Beyond setting up the institutional framework, there bears this direct cost of family leave through its budget, are several policy areas outlined below that are relevant employers have fewer hiring disincentives than if they to strengthening efforts to achieve women’s equal were required to pay family leave directly to mothers or access to economic opportunities. They do not fathers. Employers likely bear indirect costs, however, represent a comprehensive list but instead point to including the time and financial resources invested in several issues on which it would be useful to focus. hiring and training staff to replace women on maternity leave. Access to productive inputs. BiH’s existing legal framework for access to land and property can be BiH’s family leave program faces two central challenges. further improved. In addition to the need to harmonize One is the country’s territorial heterogeneity in the land registration systems throughout the country, a financing mechanisms; the other is the difficulty in recent legal assessment 19 provides a detailed review implementing the program’s provisions, as women are and puts forward recommendations on ways to close not able to go back to their jobs after a year-long gender gaps in access to land. Policies therefore could maternity leave and there is currently no arrangement include establishing the mechanisms to link land that enables them to work half of the full-time registry data with administrative and civil data, which schedule. 17 include data on matrimonial status; amending the land registry laws to enable the non-registered spouse to Policy Options to Promote Women’s register as co-owner of the property acquired during marriage without the consent of the spouse who is Access to Economic Opportunities already registered; simplifying the land registration process for the non-registered spouse (mostly women); Available options to tackle the kinds of inequalities and raising awareness and monitoring gender- outlined above include: (i) improving access to assets disaggregated data on property registration. and productive inputs, (ii) providing access to child- and eldercare and promoting investment in the care Addressing the current gender gaps in access to economy, (iii) removing the disincentives and barriers property will also improve women’s access to finance embedded in labor taxation laws and regulations, and and entrepreneurship, as they often lack the collateral (iv) increasing the employability of women through to obtain credit. There are government-led programs in effective active labor market policies that target the BiH aimed at providing grants or financing for unemployed and the inactive and provide adequate entrepreneurship that benefit women, as well as skills and training. programs that include business training. However, more remains to be done to expand these opportunities Institutions for gender equality. The Law on Gender for women through increased financing, and there is Equality in BiH and the National Gender Action Plan also room to explore additional policies to promote covering 2013–2017 protect and promote measures for women’s access to credit. the realization of gender equality in all areas of social life and work in both the public and private spheres. Access to formal child- and eldercare. International There are, however, improvements that can be made to evidence shows that the availability of affordable the national machinery for gender equality, particularly childcare is positively correlated to both female labor a needed increase in coordination between the relevant force participation and fertility. 20 At the same time, agencies and ministries. 18 robust evidence in both developing and developed countries demonstrates that investing in early 16 World Bank, “Women, Business and the Law” (database), 2016, http://wbl.worldbank.org. 18 CEDAW (2013). 17 Vaša Prava BiH (2016). 19 GIZ and FAO (2016). 20 Mateo Diaz and Rodriguez-Chamussy (2016). childhood education has a significant impact on and women and contribute to leveling the playing field children’s development and their long-term labor and in the labor market. income outcomes. Affordable childcare lessens women’s home-care burden and also increases the Active labor market policies and adequate skills and opportunity cost of leaving the labor force. training. There is still room to increase the coverage, efficiency, and effectiveness of active labor market Policy options for BiH to explore include: expanding policies for men and women, 22 not only for the publicly provided childcare centers; implementing unemployed but also for those who are inactive. One public subsidies to private childcare provision and use; priority should be reinforcing the capacity of creating education and accreditation programs to employment services to target the active labor market. prepare caregivers and care-entrepreneurs; developing a system and plan to increase the quality of services Moreover, finding a good job or succeeding as an with attention to costs, particularly the provision of entrepreneur will be possible only if women have the quality eldercare; and revising the legal framework to skills that can complement job creation in the economy. be adaptable to the demands and expectations of care. It is crucial to improve cooperation between the In addition, BiH in particular faces an aging population. education system and labor market institutions. As such, it is important that the country not only invest Relevant policy options beyond overall policies to in childcare resources but also formal systems to improve the relevance and quality of education and support the elderly. Formalized daycare and at-home training programs include vocational training for support for elderly Bosnians will facilitate more women with low education levels, apprenticeship women’s entry into the workforce. At the same time, programs in growing areas of the economy, and training the fiscal implications of the various approaches to in non-traditional sectors. promoting access to child- and eldercare and increased investments in the care economy also need to be Data from the World Bank’s STEP Employer survey 23 considered. Seizing the opportunity to develop a formal implemented in BiH are being analyzed to assess care industry could increase female labor force whether employers find gaps between women and men participation, firm productivity, and jobs. 21 in technical and socio-emotional skills (e.g., learning computer skills, adapting to new tasks, working in Labor taxation and regulations. It is key to ensure that difficult situations, providing reliability) and to shed labor taxation policies and regulations do not explicitly light on other gender-related considerations when or implicitly penalize women’s access to jobs and that hiring. 24 Gender differences in employers’ views would current provisions are fully implemented. Because likely make it more difficult for women to find a (good) implementation remains a challenge in BiH, areas to job or build on-the-job skills with the same success as focus on include (i) further facilitating flexible work their male counterparts. arrangements, such as part-time work, that allow women and men to combine work with family Cross-cutting policies areas responsibilities; and (ii) ensuring that gender equality monitoring mechanisms are in place to enforce legal Social norms and discrimination. Policies are needed to protection and avoid discrimination at work on the rebalance household and family responsibilities grounds of sex, gender, pregnancy, family, and marital between men and women and to remove barriers for status. Finally, increasing the length of paternity leave women stemming from prevailing social norms that or giving additional incentives to fathers can help more limit their opportunities, even in cases where the legal evenly balance childcare responsibilities between men framework is in place, as it is in BiH. Many discussions with government and nongovernment stakeholders 21 IFC (2017); Ilkkaracan, Kim, and Kaya (2015). 23 As part of the Skills Towards Employability and Productivity (STEP) 22 EC (2016). Skills Measurement Program. 24Cojocaru (2017). persistently point to the significant challenges in employment offices. Beyond labor market–relevant implementing current legislation, with social norms as information, providing training and information to an underlying driver. women about, for example, their rights and the Therefore, it is key to: procedures involved in property registration and inheritance can help close the implementation gap. (i) Promote policies that foster co-responsibility between men and women, including promoting and Monitoring and evaluation. Improved monitoring and monitoring the use of paternity benefits. Policy efforts evaluation (M&E) systems are essential to closing to increase the availability of child- and eldercare will gender gaps in access to economic opportunities, also help. particularly as the core institutional and legislative frameworks for gender equality are already in place. (ii) Provide public policy incentives that promote M&E systems allow policy makers to identify areas women’s access to economic opportunities. This may where policy efforts should be increased or adjusted, as include offering incentives to hire and train women in well as areas of progress. They also promote the non-traditional sectors; increasing employer awareness availability and use of gender-disaggregated when hiring through, for example, gender certification information in relevant administrative and survey data programs or behavioral interventions to address such as that from property registration and active labor employers’ gender biases in the hiring process; and market programs. A review of policies on access to providing information, training, and incentives for economic opportunities in BiH reveals that there is public servants and service providers working in considerable room to improve coordination across relevant institutions (e.g., in cadaster offices with implementing stakeholders, which calls for increased regard to women’s property rights). efforts to document and monitor the landscape of interventions. Importantly, it also shows that few (iii) Influence aspirations and expectations through, for interventions are evaluated at the outcome level, thus example: programs based on role models and limiting the advance of knowledge on what actually mentoring; media interventions (e.g., television and works to increase women’s access to economic radio campaigns), to expose people to information and opportunities and how to better allocate resources. 26 role models; or the dissemination of information on increased job opportunities for women. How Can the World Bank Group Access to information. As part of efforts to increase the employability of the population, it is important to Help? provide information to young men and women that could influence their schooling and school-to-work Over the past several years, the World Bank has aimed transition decisions (e.g., information on the labor at building an evidence base to inform the gender market and returns to education), which can also be equality agenda in BiH, particularly with regard to critical in shifting social norms that push women into gender gaps in access to economic opportunities. This certain fields of study or occupations. Evidence for the has included a Gender Assessment 27 of the country; an region emphasizes the importance of accessing analysis of the economic impact of gender gaps in the information and networks that can facilitate the labor market; 28 an assessment of the demand for and transition to the labor market. 25 This entails supply of child- and eldercare in BiH 29; and a review of strengthening labor market information systems and and consultations about potential policies to close the career guidance services, including through public gender gaps. 30 25 Arias et al (2014). 29 World Bank (2015). 26 “World Bank (2016c). 30 This was a policy review involving interviews with government and 27 World Bank et al. (2015). nongovernment stakeholders carried out by a consultant in fall 28 Cuberes and Teignier (2015). 2016. 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