KWDI Korean Women’s Development Institute

Research Purposes

The Korea society has faced the full-fledged tendency of aging and low fertility after 2000 and, also, caught by the economic crisis twice. There are certain changes emerged in the female labor market, which are mostly represented as the stagnation of women's economic participation and the reduction of female self-employed persons. This study focuses on the latter indication, as the social security of self-employed workers has been an important topic of interest for many years. It is an important and interesting issue to find out how strong the decreasing trend of female self-employed workers is, what brings out this decrement, and what changes are observed in the characteristics in female self-employed workers. Therefore this study aims to analyze the range and the cause of the reduction of female self-employed workers after 2000, and will make an attempt to seek for an effective policy.

The Reduction of Female Self-employed Workers after 2000

The most salient trait of the structural trend in the non-employed labor market is continuous diminution of female own-account workers and unpaid family workers. And it could be postulated that female self-employed persons were more sensitive to the business fluctuation than male self-employed workers at the time of economic crisis in 2003 and 2009. The rate of Korea's own-account workers is quite high among OECD countries, but most of the countries had their decrease of the rate for this resent decade(1998-2008) including Korea. Especially, although Korea's rate of female self-employers takes a large part of it, it declined rather faster than male own-account workers for the past 10 years.

The Trait of Female Own-account Workers

As the National Statistical Office has reported in the optional survey of 2010 Economically Active Population in August, it is well shown that female self-employed workers are much seen in small businesses. Through the rate of the location of business premises, the business registration, financing and the scale of initial expenses, and the subscription in the National Pension, it is comprehensible that great number of female own-account workers are operating small-scaled enterprises. At the same time, the aging and less educated populations are relatively broad within self-employed workers, so it is obvious to prepare the measures for them when dealing with the effective provision for whole range of female self-employment. Moreover, the features of unpaid family workers are observed substantially different by gender. Of approximately 130 thousand male unpaid family workers in 2010, unmarried males take up 44.6% which indicates a huge and clear contrast with unmarried female rate 2.7%. And also, a large part of male is consisted of those in their twenties, and they tend to have a high-level educational background than male own-account workers. These results suggest that women family workers are more likely to cooperate with their spouses' business and males tend to support their parent's own-account business.

Analysis of Labor Flow of Female Self-employed Workers

The monthly data of Economically Active Population of National Statistical Office were transformed into panel data, and the entry and exit patterns of female own-account workers are analyzed. It is practically impossible to transform the whole data into panel data within the past decade regarding that the original samples are reorganized every three years. Due to the fact that self-employed enterprises are sensitively influenced by economic fluctuations, the monthly panels are established with 24 months of 2009-2010 which was the period to be affected by the world financial crisis in 2008, the time of major recession. The transition of female self-employed workers show interesting results. They tend to turn out to be non economically active and be flowed into the own-account business from the non economically active status. Their rate of transition between self-employment and non-economically active is much higher than males. On the contrary, cases of the shift to and from waged working status are less than male. And even when the entry occurs, females are likely to enter to the occupations of unstable status such as daily laborers or fixed term workers in sales and service industries. Regarding this frequent transition of female own-account workers, "making transitions pay” policies for better conditions should be necessarily considered.

Suggestions

The first suggestion is to provide an industrial policy for small-scale businesses such as Home Service Scheme of Denmark which is a good example. Secondly, active labor market policies must be planned for self-employment. And thirdly, as self-employed workers are exposed to risks and instability than any other working populations but has excluded in social welfare, they should be integrated to the social security system. The fourth suggestion is to demand for the provision of concrete scheme of the business registration for female self-employed workers. It is an imperative issue, because the current existing government policy is effective only for the registered business and more than 50% of female own-account workers are non-registered. Finally, the establishment of a government agency for (women) self-employment is acutely required and suggested.