In Pakistan, a high fraction of the female population are “latent workers,” i.e., interested in working but economically inactive due to lack of opportunities. Female labor force participation in Pakistan was 21% in 2020 compared to a male labor force participation rate of 78%, but a quarter of women who are not working report they would like to work if they could find a suitable job. Such vast gender gaps in employment persist in many low - and middle-income countries, particularly in South Asia, the Middle East, and North Africa. 

A growing body of literature focuses on the factors that constrain women's labor supply in these contexts, such as self-selecting into occupations that conform to gender identity, differing preferences for job attributes, and gendered social norms about time use. However, a smaller body of work shows that employers’ reluctance to hiring women can also contribute to gender gaps in employment. We set out to investigate whether supply-side factors, i.e., worker’s willingness to supply their labor; or demand-side factors, i.e., employers’ hiring decisions matter more in creating this persistent gender gap.

Our research partners at the Centre for Economic Research in Pakistan (CERP) developed a new job matching platform, Job Talash, and offered it as a free service to representative listings of thousands of households and thousands of firms in a single urban labor market (Figure 1). Thus, unlike other studies based on job search platforms, we capture latent workers in our sample.

Figure 1:  A Flyer for Job Talash
Source: Centre for Economic Research in Pakistan

Job Talash works by matching each jobseeker to open vacancies based on whether they satisfy minimal criteria set by the firm for the vacancy and occupational preferences set by the jobseeker. The platform sends information to the jobseeker about all the vacancies that meet all criteria, and the jobseeker can decide whether to apply to each one. Thus, the platform generates high-frequency, detailed data on both the supply and demand sides of the labor market for millions of potential job matches between firm and respondent.

We also conducted an incentivized resume rating (IRR) experiment with firms in the Job Talash sample. We showed employers on the platform a series of pairs of CVs and in each pair asked the respondent to select the one that they would be most likely to hire, with the incentive that this could help inform the applicant pool sent to them through the Job Talash platform. CVs for this exercise were constructed using the actual job applicant data from the Job Talash pool, making them a realistic representation of the candidates the firm might see on the platform; we randomly vary the gender of the applicant on the CV to identify firm preferences over gender, holding constant other characteristics such as levels of education and experience between men and women in the pool.

The results from our analysis of the administrative data and the IRR experiment yield 3 key findings, First, gender gaps in employment are greater in magnitude than gender gaps in search. Women are 89% less likely than men to be working at baseline; however, they are only 53% less likely to complete signup for the Job Talash platform, an investment of time in the telephone-based signup process (Figure 2) that indicates willingness to search. The gender gap in both work and willingness to search narrows as education levels rise. At higher education levels, the gender gap in completing the signup process falls by 65%. These findings suggest that many women, particularly educated women, are latent workers, pointing to key constraints on the labor demand side.
 

Figure 2: The Job Talash Hotline
Source: Centre for Economic Research in Pakistan

Second, for less educated jobseekers, firm gender criteria—an entirely demand-side constraint—are more binding for women than men and are also a larger constraint than supply-side decisions. Women in our setting are 53% less likely than men to satisfy the explicit gender requirements for any given vacancy. These patterns persist even when we restrict to vacancies where the individual met the education and experience criteria and expressed interest in the occupation: demand-side criteria are the binding constraint on opportunities available to women. In fact, in the set of vacancies where individuals satisfied all basic criteria and were eligible to apply, women apply at a higher rate than men, overall.

Finally, the demand-side gap in quantity of job opportunities substantially closes as education levels rise, while on the supply side women become more selective. The gender gap in satisfying the gender criteria for a position shrinks by 70% for the minority of women with secondary education and effectively disappears for the third of women with a tertiary education. We find that firms' gender criteria and the educational requirements of the job are mirrored; vacancies with “blue collar" characteristics such as manual labor and longer and late work hours are more likely to exclude women and more common among jobs with low education requirements, even conditional on industry and occupation fixed effects. 

Additionally, firms' gender criteria and the education level they seek to hire reflect existing infrastructure at the firm: firms that have restrooms or a separate prayer space for women are both more likely to be willing to hire women and more likely to be hiring at a high education level. Strikingly, among those with a tertiary education, women are more selective than men in their job search. At this high education level, women are slightly less likely than men to have selected the occupation of a given vacancy and are slightly less likely to apply to a vacancy. But this is likely driven by differences in the quality of vacancies by gender; indeed, we find that among those with a tertiary education, women are more likely than men to qualify for the vacancies at the lowest quintile of the salary distribution.

Much of the recent literature that studies low female employment focuses on alleviating supply-side constraints via interventions such as overcoming information asymmetries, training in socio-emotional skills, addressing norms by engaging partners and family members, safe transport, and social protection programs that target women. Our results show that more emphasis is needed on demand-side interventions, including incentives such as tax breaks or grants for firms to offer workplace facilities that would be inclusive to women and might in turn increase firms' willingness to hire women.
 

- Elisabetta Gentile is a Senior Economist, South Asia Department, Asian Development Bank, and Fellow, Global Labor Organization.
- Nikita Kohli is a Ph.D. Candidate, Sanford School of Public Policy, Duke University.
- Nivedhitha Subramanian is an Assistant Professor, Department of Economics, Bates College.
- Zunia Tirmazee is an Assistant Professor, Center for Research in Economics and Business, Lahore School of Economics.
- Kate Vyborny is an Economist, South Asia Region Gender Innovation Lab, World Bank.