Veiled Employment: Islamism and the Political Economy of Women’s Employment in Iran

8. Iran’s Missing Working Women

256 8 Iran’s Missing Working Women Fatemeh Etemad Moghadam Available studies on Iran suggest the existence of a large, diverse, and growing informal economy. Estimates on the share of the informal economy vary from 6 to 33 percent of the total GDP, and 47 percent of the labor force (Khalatbari 1994; Renâni 2001; Taher-Far 1997). Nearly all studies point to a substantial presence of women in the informal economy. The evidence also suggests considerable undercounting of women’s work in Iran (F. Moghadam 2007). Using a sample of 350 women from the affluent northern part of Tehran , this chapter tests the hypothesis of the existence of a significant informal economy with female labor participants who do not fit the stereotype of being poor, uneducated, and unable to join the formal economy. Nevertheless they are gainfully employed in the unregulated and informal market economy, and are unaccounted for in the official statistics. The concept of informal economy refers to “unregulated” and “unorganized” economic activities that take place outside the framework of corporate public and private sector establishments and may be unaccounted for in the formal official statistics. The intellectual origin of the concept is found in the failure of the formal dualistic Lewis-type economic models to address the existence of masses of gainfully and positively employed people in urban areas that these models assumed to be subsistence and surplus (Hart 1998, 845–46; Lewis 1954, 139–91). A number of leading scholars in the field view the existence of this entrepreneurial and self-employed economy Iran’s Missing Working Women • 257 as a positive and vibrant contributor to the economies of developing countries (De Soto 1989; Hart 1990, 137–60). In most studies undertaken by the ILO, however, the underlying assumption is that such workers are unable to enter the formal economy (ILO 2002). A number of studies carried out within the advanced industrial countries are based on structuralist and institutionalist schools of thought. These studies do not make an a priori negative assumption about income and skill, focus on competitive and cost-reducing aspects of microfirms, and define informal as income-generating activities that result in the production of legal goods and services but are not regulated by the formal institutional/legal rules and are denied formal protections (Portes 1994, 426–49; Feige 1990, 989– 1002). A recent study on Latin America indicates that such activities are not limited to those unable to join the formal economy and that women may prefer informal self-employment over formal employment in order to balance family and work responsibilities (World Bank 2007; Williams 2006, 1). Most empirical studies on the subject, however, have been undertaken in poor slum areas, on new rural-urban migrants and self-employed or family workers with little formal education. The underlying presumption is that such workers are unable to enter the “formal” labor market (Todaro 1989, 268). The present study, however , was undertaken within the affluent northern part of Tehran and tested the hypothesis of the presence of educated middle- and upper-class women within the informal economy. Since the 1970s, another issue that gained recognition and growing popularity and support is the underestimation of women’s work in labor statistics and national income accounts. Feminist economists have pointed out that official national statistics underestimate women’s work in four major areas: agricultural and subsistence production , paid work in the informal economy with poor and recent urban migrant women, domestic production and related tasks, and volunteer work (Benería 1997, 112). None of these studies, however, points at the undercounting of labor market participation of educated middle- and upper-class women. A study by the World Bank on 258 • Veiled Employment the MENA region can be interpreted as empirically supportive of the hypothesis of undercounting of educated and skilled women’s labor market participation. But the study itself treats the findings as paradoxical . While MENA’s achievements in education, fertility, and life expectancy compare favorably with those of other regions, the rate of female labor force participation is significantly lower than rates elsewhere in the world (World Bank 2004, 1). This paradox is generally explained by sociocultural factors. Here I suggest that another explanation may be the existence of a sizeable unmeasured and hidden informal female economy that is inclusive of not only poor and unskilled female workers but also middle- and upper-class educated and skilled women. Therefore this chapter examines...