Erika Kispeter, Dorottya Redai and Eva Fodor. Local Production Systems in Szekesfehervar, Hungary

FLOWS WORKING PAPER SERIES NO. 14/2014 Erika Kispeter, Dorottya Redai and Eva Fodor Local Production Systems in Szekesfehervar, Hungary FLOWS: Impact of local welfare systems on female labour force participation and social cohesion 1

FLOWS Working Paper Editor: Per H. Jensen E-mail: perh@dps.aau.dk www.flows-eu.eu Working papers may be ordered from: Inge Merete Ejsing-Duun Fibigerstræde 1 9220 Aalborg Ø E-mail: ime@dps.aau.dk Tlf: (+45) 99 40 82 18 Fax: (+45) 98 15 53 46 Aalborg 2014 ISSN 2246-4840 2

About the FLOWS project: The FLOWS project has been funded under the EU FP7 program, grant Agreement no: 266806. The project started January 1 2011 and ended April 30 2014. The FLOWS project analyses the causes and effects of women s labour market integration, which is an issue that represents a major challenge for the European Union and its member states, and is supposedly also a precondition for the sustainability of the European social model. The overall aim is to analyse (1) how local welfare systems support women s labour market participation, as well as (2) the extent to which (and under which conditions) female labour market integration has contributed to the strengthening social cohesion. The project focuses on how public and private welfare services such as care and lifelong learning intended to support women s labour market integration have been designed; on how women of different classes, qualifications, ethnicities, and geographical locations have grasped and made use of such policies, and on how the increase in women s labour market integration has affected structures of inequality and social cohesion. The study is based on in-depth analysis of eleven cities, i.e. one city in eleven different countries. The cities/countries are: Brno/Czech Republic, Aalborg/Denmark, Tartu/Estonia, Jyväskylä/Finland, Nantes/France, Hamburg/Germany, Székesfehérvar/Hungary, Dublin/Ireland, Bologna/Italy, Terrassa/Spain, and Leeds/UK. The FLOWS project is composed by 6 academic work packages: WP 1: Degree and structures of women's labour market integration WP 2: Local production systems WP 3: The local welfare system WP 4: Local policy formation/local political actors WP 5: Survey questionnaire WP 6: Women s decision making WP 7: Social structures: cohesion or cleavages and segregation This working paper series reports work conducted in the seven work packages. 3

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1. Urban pattern of development and structure of the labour market (approx. 2500 words) Basic information Name of the city: Szekesfehervar NUTS 3: Fejer NUTS 2: Central-Transdanubia Country: Hungary Important note about data: NUTS 3, NUTS 2 and national level data presented in this report come from the Hungarian Labour Force Survey, and include people aged 15-74. As the LFS sample is too small at the urban level, data about the city come from a number of different sources: 1) the Hungarian Central Statistical Office regularly surveys employers in the city. In this data collection the age of employed people is not specified. 2) Some data come from the 2001 census 3) data on wages and the distribution of men and women employees in different economic subsectors in the citycome from the Individual Earnings Survey, conducted annually by the National Employment Office. The age of employees is not specified in this data collection either. Over the last 15 years, what has been the growth rate in the local production system and the most important transformations in the sectors of specialization of the local economy? As data about GDP are not available at the urban level, in this section I will focus on the NUTS 3 area. GDP/inhabitant was 4700 Euros in 1997 at NUTS 3 level and increased every year so that by 2008 it was 9900 Euros at current prices. In the late 1990s the NUTS 3 level GDP/inhabitant value was higher than the national average, but it dropped below the national average in 2002, and did not reach it again until 2008 (latest data published). In 2008 the volume of local economic production was at 93.2 % of the national value (Annex Table 1.1.1). The GDP/inhabitant at NUTS 2 level has been lower than at NUTS 3 level 5

throughout the FLOWS time period of 1995 to present, which shows that the NUTS 3 level area where our city is situated is one of the more economically developed parts of the region and the country. As Table 1 shows, the local prodction system is characterized by the dominance of industries. Table 1. Economic production by economic sectors at different territorial levels in 2005 NUTS 3 NUTS 2 Country Industries 40.4 %, 42.4 %, 25.3 %, Services 49.1 48 % 65.5 % Source: HCSO 2007b Among industries, manufacturing has the highest volume of production: in 2006, 98% of industrial production came from manufacturing at NUTS 3 level. Within manufacturing, the contribution of different subsectors to local economic production is as follows (at NUTS 3 level): machinery 69 %, metal industry 18.4%, food industry 4.9 %, chemical industry 2.4%, textiles 0.32 % (HCSO 2003b). Although the weight of different subsectors changed over time, the dominance of the machinery and metal industries remained unchanged The industry of the NUTS 3 area is very centralized: 80% of industrial production come from companies that employ more than 300 employees (HCSO 2007b). The industry of the NUTS 3 area is export oriented: in 2002 76.3 % of industrial products, and 96.2 % of machinery products were sold abroad. Due to the dominance of large, multinational companies and the export orientation, fluctuations on the global market of machinery and metal products tend to have an immediate effect on the local production system. For example, when IBM closed down its plant in our city in 2002, industrial production declined by 6.8 per cent at NUTS 3 level (HCSO 2003). In the same time period at the national level industrial production increased by 6,6 %, which shows that our city and its immediate surroundings are more influenced by the global than the national economic context. 6

The trend int he value of labour productivity (GDP/employed) at NUTS 3 level are similar to what we discussed about the GDP/inhabitant value. The NUTS 3 area of our city has been characterised by a slightly higher labour productivity than the region throughout the FLOWS period. Compared to the national level, the NUTS 3 labour productivity is almost the same, or somewhat lower, without showing a clear trend (see Annex Table 1.1.2) Please specify the peculiarity of your city in comparison to the national and regional/land/provincial context As Table 2 shows, the employment profile of our city, Szekesfehervar is characterised by the dominance of industries. The proportion of people employed in services is lower than at the national level, but higher than at NUTS 3 and 2 levels. This is partly explained by the city s status as the administrative centre of the NUTS 3 area, which means that there are more jobs in non-market services, such as public administration and health. Table 2. Distribution of full-time employees in macroeconomic sectors at urban, NUTS 3, NUTS 2 and country level in 2006 (%) Szekesfehervar NUTS 3 NUTS 2 Hungary Employed in 1.6 4.5 4.9 4.9 agriculture Employed in 43.5 43.2 44.0 32.2 industries (%) Employed in services (%) 54.5 52.2 51.0 62.8 Source: Urban level: HCSO 2007a, other levels: HCSO, Labor Force Survey 2006 7

Please provide more detailed information about particular sub-sectors characterizing the economy of the city. In 2009, almost half of employed people in the city (47.7%) worked in the industries, the majority of them, 43 % of all employees, in manufacturing. Within manufacturing the most dominant subsectors are the machinery, metal and electronics industries. The dominance of these subsectors can be traced back to the state socialist era, when three large factories were located in Szekesfehervar, which had a major influence on the economy of the city and the region. One of the factories produced aluminium products, such as aluminium plate, sheet and foil. The second company manufactured buses and coaches used in public transport, and the third one specialized in electronic products, such as televisions, radios, videos, and also had a section producing electronic items used by the military. Links to the military made the electronic plant an important site of not only production, but also research and development. Although these state socialist companies were privatised in the 1990s, their legacy is still important, and explains the employment structure of the city and the NUTS 3 area. In the early 1990s employment in the industrial sector, especially in manufacturing declined less here than nationally. This can be explained by the fact that the trained work force and the existing infrastructure for metal and electronics production attracted multinational companies to the city in the 1990s (Alcoa, IBM, Philips), and smaller, locally owned companies which rely on the trained workforce. Even the buildings of the state socialist giants served as a resource. The local government tried to encourage this trend and attract industrial investment by establishing industrial zones, of which there are five on the outskirts of our city. The great majority of foreign investment went to the development of the industrial sector: 82.6 % of all foreign investments in 2000. Other sectors influenced by foreign investment are transport, telecommunications and postal services, which received10.7 % and wholesale and retail 3.6 % (HCSO 2003b). Although the share of industrial employment remained high, some traditional state socialist industrial subsectors which were well established in the city declined after 1990: 8

employment dropped in the textile and garment (by 9.9 % only in 2002) and chemical industries (by 7.2 % in 2002) (HCSO 2003b). On the other hand employment in services increased somewhat, but not as much as the national average. For example in 2004 employment in communal and personal services increased by 21,5 %, in real estate services by 12,7%, and also in retail and repair by 11,7 %. As for advanced services, 3 % are employed in these subsectors 1 and 7% of employed people work in transport and logistics (HCSO, 2010). In 2010, employment increased in the subsectors of information and communication in our region by 9.2 per cent, which is higher than in other areas of the country (HCSO 2011b). Logistics is another developing sector, as the location of the city - near the capital and the Western boarder of the country along a motorway - prompted investors to establish a logistics service centre, which is the only one in the region (HCSO 2010). However, given their low weight compared to the industries, the changes in service employment do not have a strong effect on the whole of the local production system. In sum, the production system of our city is dominated by industries, especially the metal and machinery industries, while at the national level services are dominant. This peculiarity can be explained by the legacy of state socialist industrialization. What have been the main impacts of these transformations on the employment opportunities for women? I will discuss women s employment by focusing on changes in women s (un)employment and in their economic inactivity. I will also refer to statistics on men s employment to point out the gender differences. Due to the post-state socialist transformations the employment rate of both men and women dropped radically in the early 1990s. After 1995 the first year of the FLOWS period the 1 Advanced services: information and communication technologies, financial and insurance services. 9

employment rate stagnated, then started to grow. However, in 2001 the number of all employed people at NUTS 3 level was still 14.% lower than it was in 1980, and 8.5 % lower than in 1990 (HCSO 2003a). The massive drop in employment was reflected in the level of unemployment. During the state socialist period unemployment officially did not exist 2 and was not measured. In 1995 unemployment in the NUTS 3 area was 10.40 % among men and 9. 40 % among women (Annex Table 1.3.5). By 2001 it dropped to 4.33 % and 5.41 % respectively and it reached the lowest level in 2007, with 3.81 % unemployment among men and 5.98 % among women. At the city level, men s unemployment was 3.55 % in 2001, and women s was 2.85% (Annex Table 1.3.1). The low levels of unemployment are explained by the high level of economic inactivity, especially among women. In the first years of the post- state socialist transformations several women opted for early retirement, and thus became inactive, rather than unemployed. In 2001 32.69 % of men and 47.06 % of women in Szekesfehervar were inactive in the 15-74 age group (Annex Table 1.3.1). At NUTS 3 level the figures were 35.3 per cent among men and 52.2 per cent among women in 2001 (Annex Table 1.3.5). The dissolution of state socialist economy in the early 1990s affected men more than women. During state socialism men concentrated in the heavy industries. These firms were closed down or severely downsized in the 1990s, making a large number of men unemployed. Women on the other hand were more protected from unemployment in this period, due to their concentration in the service sector (Fodor 1997, Nagy 2010). However, as Annex Table 1.3.5 shows, women s advantage in unemployment soon disappeared. Part-time jobs, which are often seen as the solution to work-family conflicts (especially for women) are at a very low level both nationally and locally: at NUTS 2 level 5.1, at NUTS 3 level 5.7 per cent of women employees work part time. The rate of part-time employees 10

among men and women is lower in both the region and in the NUTS 3 area than nationally (Annex Table 1.3.6). Based on an estimate, it seems that at the city level the rate of parttime workers is higher among men than at NUTS 3 level: the rate is 3.3 % in the city, and 2.65 % at NUTS 3 level in 2010), while for women there is no significant difference (Annex Table 1.3.3). Although both the representative of the local trade unions and the head of the local employment office stated that the number of people employed with a temporary work contract is on the rise, figures of the Labour Force Survey show that the rate of these contracts is lower at NUTS 3 level than nationally for both men and women.(annex Table 1.3.6). Based on an estimate it seems that the rate is the same, or even slightly lower at the city level than at the NUTS 3 level (Annex Table 1.3.3). Temporary employment is often arranged through private employment/staffing agencies. The rate of workers employed by these agencies and hired for short or long term by companies is increasing in our city according to the local experts we have interviewed. Especially multinational firms tend to employ a high proportion of their workers through agencies. These employees often receive higher salaries than the company s core workers, however, their jobs are less protected and their contracts are always fix term, often as short-term as one month (source: interview with the head of the local employment office and with the local trade union representative). However, according to the Labour Force Survey, the proportion of workers employed through agencies is below 1 %. Women are less likely to be self-employed than men: at NUTS 3 level in 2010 5% of women and 9 % of employed men worked in this form. At the urban level 11 % of employed men, and 7,12 % of employed women were self-employed in 2001. In sum, women s employment increased in our city since 1995, however, it is still at a lower level than it was before the post-state socialist transformations of the early 1990s. In particular, women s inactivity rate is high both in our city and in Hungary as a whole. The 2 Full employment was an important goal and value in the state socialist system, and all able bodied adults were legally obliged to be employed. 11

rate of part-time work, self-employment and temporary employment are all very low in our city, as well as at the national level. What have been the most important transformations affecting the supply of female employment over the last two decades, with particular attention paid to: a) changes in the educational level; b) transformations in cultural attitudes; c) changes in the family structure Women s educational level has steadily increased since 1995 as Annex Table 2.3.1 and 2.3.2 show, although it was already high at the beginning of the FLOWS time period. Women s level of education in the 15-74 age group in our city in 2010 is as follows: 27.3 % is at ISCED level 0-2, 14.4 % at level 3 C, 36.3 % at level 3A, 4, and 22 % at level 5-6. Changing attitudes have also impacted on women s employment. The state socialist: discourse of women s emancipation disappeared, and the ideal of the stay-at-home mother and wife (re-)emerged in the 1990s. Although this ideal is unattainable for most of the population, as few men earn enough to support a family by themselves, women s paid work is not considered as natural as it was in the 1980s. The public discussion on the obligatory choice between family and career makes young families insecure about their position (Nagy 2010). Since Hungary become a member of the European Union, the targets set for increasing women s employment also appeared in Hungarian public discussions, as a counterpoint to the conservative and/or anticommunist discourse against women s paid work. However, the EU discourse is less strong. Gender division of labour in the families The current Hungarian labour market is characterized by long work hours and employers lower tolerance towards workers family/care responsibilities. Thus, many women, especially those with young children find it difficult to meet the demands of their jobs and their families. In industrial workplaces, which dominate in our city, work hours are rather inflexible, and shift work is common, which makes it more difficult for mothers of young children to return to paid work after the parental leave. However, very few men earn enough to support their families, thus few women can actually afford to leave the labour market. Instead, women often stay on extended parental leaves and thus, appear 12

economically inactive in statistics (Balint and Kollo 2007). At the same time, there have been a reduction in child care places, especially for children under the age of 3 (Fultz and Steinhilber, 2003), which also makes it more difficult for mothers of young children to return to paid work after the parental leave. There is no shortage of day care places for children older than 3, although the opening hours of state financed kindergartens are short and inflexible. In sum, there have been no major transformations over the last two decades that affected women s labour supply, thus changes on the demand-side are more likely to account for the declining employment of women. Recently, how has the economic-financial crisis affected female and male a) employment; b) unemployment; c) participation into the labour market? The recent financial-economic crisis led to the second greatest wave of unemployment in Hungary: the unemployment rate reached 11 %, which is almost as high as the unemployment figures in the early 1990s. At the national level women s unemployment was higher than men s before the crisis (the third quarter of 2008), but one year later men s unemployment rate was higher than women s. This is most likely due to men s dominance in manufacturing, especially in the metal industry, which was severely hit by the crisis. The first period of the crisis affected our city and the region particularly hard, as the local industries produce almost exclusively for export. The number of employees declined by 8,4% at NUTS 2 level between the third quarter of 2008 and 2009 (HCSO 2010b). The picture is somewhat different in our NUTS3 area. As Table 3 shows, the economic crisis affected both women and men s employment more severely in our region, and in particular in our NUTS 3 area than in other parts of the country. Table 3. Unemployment rates (%) in the third quarter of 2009, and the growth compared to the same period of 2008 by gender 13

Men (2009) Annual growth Women (2009) Annual growth NUTS 3 11 5.2 10.9 5.4 NUTS 2 9.7 4.1 10.4 4.3 Hungary 10.5 3.1 10.1 2.1 Source: HCSO 2010c As mentioned above, in our city a large number of men are employed in the metal industry, which was strongly affected by the crisis. According to national data collected from businesses employing at least 50 people, 25 % of jobs in the metal industry disappeared during the crisis. Industrial subsectors characterised by the dominance of women were less affected: businesses employing at least 50 people in the retail sector cut only 2,3% of jobs. There were no job cuts in public services either, where women are the majority of employees. Despite the fact that many women work in economic subsectors that were not affected by the crisis, the proportion of newly unemployed men and women is the same at NUTS 3 level. This means that women employed in manufacturing tended to lose their jobs more often than men (HCSO 2010c). How have all these economic transformations affected the income gap between men/women? At the urban level the pay gap between men and women has not changed significantly since 2002: it has varied between 0.75 and 0.85. 3 The economic crisis did not seem to have a strong effect: the income gap was 0.86 in 2009, and 0.82 in 2010, Annex Table 1.5.1). At NUTS 3 level the gender wage gap has declined since 1995 from roughly 70% to roughly 80%, and did not change much during the economic crisis: in 2008 the gap was 0.74, while in 2009 it was 0.79. 3 I calculated the gender gap in pay by dividing women s annual gross salary by men s. 14

To sum up the main points of the first part of the report, women s employment rate is significantly lower than men s both in our city and in Hungary. The gender gap in unemployment is small, it is the gap in activity rates that is large. There have been no major changes in the supply of female labour over the last two decades, it seems that the main causes of women s low economic activity are linked to the demand side. Our city is characterised by a slightly higher level of female (and male) employment than the country as a whole. The production system of the city is dominated by the industries, while at the national level the dominance of services is characteristic. 2. Horizontal and vertical sex segregation (approx 2500) Important note on data and methodology: At the urban level gender segregated employment data are scarce. The most reliable data come from the 2001 census. Data on salaries and employment according to economic subsectors come from the Individual Earnings Survey, conducted by the National Employment Office in May 2009. Due to the small sample size, at the urban level these data are not completely reliable, they provide only a well grounded estimate. What are the economic sectors more affected by sex horizontal segregation? The most reliable urban level data on gender segregation of the labour market come form the 2001 census, the most recent data, which is only an estimate, come from 2009. In 2001 construction was dominated by men with 9,97 % of men but only 1,93 % of women working here. Education (3,13 % of men and 13,1 % of women) as well as health and social services (2,45 % of men and 9,63 % of women) were dominated by women, as shown in Annex Table 2.1.1. However, as the figures quoted above prove, a relatively small proportion of employed women worked in these, heavily segregated sectors. The majority of both men and women were employed in manufacturing: 34.54 % of men and 26.21 % of women. Thus, manufacturing is not characterized by gender segregation, or at least, at this level of analysis segregation cannot be detected. A fairly large group of women, approximately 15 % 15

worked in the wholesale retail, repair of motor vehicles sector, which was not characterized by gender segregation either. In 2009 construction is still dominated by men, but less strongly than in 2001. As we have more detailed data, we can see that transport and storage is also dominated by men: 11.5 % of men and 3 % of women work in this sector. Women continue to dominate all sectors of public services (education: 15 % of women, 3 % of men), health services (12 % of women and 3 % of men) and government administration (17 % of women, 8 % of men), as shown in Annex Table 2.1.2. Looking at manufacturing, where most men and women are still employed (40% of men and 24 % of women work in manufacturing), we can see that gender segregation in this sector has increased since 2001, and manufacturing is now dominated by men. As we have more detailed data, we can tell that the gender difference is caused by women missing from the metal industry: 19 % of employed men, while only 9 % of women work in this subsector (Annex Table 2.1.2). In the other subsectors of manufacturing there is no strong gender segregation. Data about gender segregation in the three main sectors of our city are summarized in Table 4. Table 4 Distribution of employed men and women in economic sectors in Szekesfehervar in 2001 and 2009 4 Manufacturing Market services Public services men women men women men women 2009 40.89 24.96 34.23 29.61 14.08 44.19 2001 34.54 26.21 35.72 33.20 15.49 36.38 Source: 2001: HCSO census, 2009: Individual Earnings Survey, National Employment Office. The 2009 are only estimates. 4 Comparability is limited: the 2001 data come from the census, while the 2009 data come from the Individual Earnings Survey, which only includes full-time workers. Furthermore, the census includes people who live in the city, but may work somewhere else, while the survey includes people who work in the city but may live somewhere else. 16

Gender segregation at NUTS 3 level is somewhat different from the city level, as it is shown in Annex Table 2.1.3. Again, it is particularly interesting to look at manufacturing. While the period between 1995-2008 is characterised by a gender balance, gender segregation increased in the last few years of the FLOWS period: in 2010, 33% of men and 24 % of women worked in manufacturing. This shows that the economic crisis had a stronger negative effect on women employed in manufacturing than on men (as we have seen before when analyzing the gender effects of the economic crisis in section 1 of this report). Construction is perhaps the most gender segregated sector at NUTS 3 level: hardly any women work here, while 10-15 per cent of employed men are concentrated in this sector. Looking at market services in general, we find that the distribution of men and women is fairly balanced, similarly to manufacuring, although a somewhat larger proportion of women work in this sector than of men. If we analyse employment in market service sin more detail, we find that financial services is a sector where women are more likely to work than men, and transport and storage is dominated by men. Wholesale, retail and repair of motor vehicles seems relatively balanced, however, it is possible that men are segregated in the repair subsector, and women in retail, but we have no data. Non-market services are characterised by women s concentration at NUTS 3 level as well, and the segregation has increased in the last 15 years: a smaller proportion of men work in these sectors now than in 1995, while approximately the same proportion of women men seem to be leaving this sector. Education and health and social services are the two most important sectors where women are concentrated at NUTS 3 level. In sum, construction is dominated by men, while health and education and public administration are dominated by women at both the urban and NUTS 3 levels. Gender segregation is increasing in manufacturing, where most people are employed in our city. What are the occupations more affected by vertical segregation (male and female)? At the urban level information about occupational segregation is only available from the 2001 census. Almost all the occupations are affected by strong gender segregation in 17

the city: legislators, senior officials and managers (14 % of men, 8 % of women), technicians and associate professionals (12% of men, 23% of women), clerks (0.6% of men, 13% of women), and craft and related trades workers (26 % of men and only 5 % of women) and elementary occupations (3% of men, 5.5 % of women). This means that although there is no sectoral gender segregation in manufacturing, men and women work in different occupations: women are more likely to be technicians or working in elementary occupations, while men tend to work as craft workers. Are women mainly concentrated either in the public sector or in the private sector? Are they more concentrated either in small-medium size companies or in big firms? As discussed above, women are concentrated in the public sector, or to be more precise, women are fairly equally distributed in industries (private sector), market services and public services, but men are missing from the public sector at the urban level. In 2001, 84 % of men worked in the private sector, while 16 % in the public sector. For women the proportions were 64% in the private and 36 % in the public sector (Annex Table 2.1.1). In 2009, 86 % of men worked in the private sector, and 14 % in the public sector. Among women, 59 % worked in the private sector and 44 % in the public sector, which shows that although the change is small, but an even larger proportion of women are employed in the public sector now (Annex Table 2.1.2) 5. As for the distribution of men and women according to the size of companies, unfortunately the 2001 census only distinguishes between companies with fewer than 20 employees and companies with more than 20 employees. In these categories there is no significant difference between the distribution of men and women. Mothers with young children are concentrated in small-medium sized companies (HCSO 2011b). At NUTS 3 level, somewhat more women work in the private sector than in in the city, but this is also true for men: 84 % of men and 63 % of women worked in the private sector in 2009 (Annex Table 2.1.3). The slightly higher number of public service jobs in the city 5 The 2001 data come from the census, while the 2009 data come from the Individual Earnings Survey conducted by the National Employment Office. 18

compared to the NUTS 3 area is probably explained by the city s status as administrative centre, with a higher concentration of local government offices, hospitals, institutions of higher education, etc at urban than at NUTS 3 level. Are the sectors and occupations where women are particularly concentrated affected by: a) low salaries; b) instability; c) undeclared work conditions? As described above, most women in the city work in manufacturing, public administration, education, health service, and retail and repair (Annex Table 2.1.2). I will examine these sectors according to the criteria mentioned in the question. Manufacturing is affected by relative instability due to a fast changing international market and the export orientation of the local manufacturing industry. However, it is not a gender segregated area, which means that this instability affects both men and women. Manufacturing in general is not characterized by low wages, however, there is a significant gender wage gap in the metal industry and in the electronics industry within manufacturing, which means that in these subsectors women indeed earn lower salaries (Annex Table 2.2.1). A large group of women work in the retail sector, which is affected by long and irregular work hours, however, this is not a gender segregated sector. Public services, where almost only women work, provide stable job opportunities, although recently the level of stability is declining as fixed term contracts are becoming widespread as a result of cuts in local government budgets (interview with the local employment office). Moreover, these fixed term contracts are often for a period shorter than a year, which further reduces the level of job security in public servies. On top of the declining job security, health and education are also characterized by low wages. In sum, the public sector, where almost exclusively women work, is affected by low wages, and in recent years the level of job security is also declining. In less gender segregated sectors, such as manufacturing or retail we would need company level data in order to be able to say more about the gender wage gap. 19

Can you describe the horizontal and vertical segregation of women with respect to a) immigration status, b) age, c) number of children Immigrant status is not a relevant axis of inequality in the Hungarian labor market. As for age, employees near retirement age are in a more difficult position in the labor market (interview with the local employment office). According to national level data, the presence of three or more children seems to stop women from entering the labour market altogether, rather than causing segregation in women s employment (Bukodi 2005). As Nagy (2010) argues, the rigid labour market causes deep division among women who work on male terms as and those who have no connection to the labour market. Parental leaves are officially gender neutral, however, very few men use these policies: according to the 2001 Census, fewer than 0.1% of men aged 15-74 were on parental leave, while for women the rate was 5.76%. It means that having children affect primarily women s labour market position, reducing their work experience. What are the main factors explaining the horizontal and vertical segregation of women in specific economic sectors? Please consider the following possible factors: a) education: level and specialization; b) discrimination for pregnancy; c) prejudice (women are not able to do some specific jobs and are better in other kind of jobs.) d) self-exclusion; e) other In general Hungarian women s level of education is higher than men s, and this is true at urban and NUTS 3 levels. However, women are less likely to learn a trade, and more likely to obtain a certificate of secondary education (Annex Table 2.3.1 and 2.3.2). This contributes to men s dominance in trade occupations and women s dominance in clerical occupations. As for discrimination against women on the basis of pregnancy/motherhood, women sometimes cannot return to their jobs after parental leave because the company closes down or changed radically (Frey 2002). Women on parental leave are often an obvious choice for being made redundant (interview with trade union representative). According to the Hungarian Central Statistical Office, having a young child is a universal disadvantage on the Hungarian labour market (HCSO 2011b). Young women, especially 20

mothers are seen as unreliable and costly employees. As maternity and parental leaves are long, most new mothers leave the labour force for as long as four years after childbirth (Balint and Kollo 2007). According to the latest Work and Care Responsibilities survey, 29% of women whose youngest child was under the age of 8 have been out of the labour market for 9 years 6 (HCSO 2011b). Table 5. The impact of motherhood on women s employment. The difference in percentage points between the employment rates of women without children and those with a child aged 0-6, women s age group: 20-50 years 2001 2002 2003 2004 2005 EU 25 14.2 14.1 13.6 13.6 14.13 EU 15 12.6 12.7 12.2 12.5 13.3 NMS10 22.0 20.2 20.0 18.7 19.5 Hu 35.0 35.1 37.1 34.1 35.3 Source: European Commission (2006) Another important factor in the low level of mothers employment in Hungary is the decline in the number of child care facilities. Several nursery schools were closed in our city in the 1990s, which often prohibits mothers with children under three from returning to the labour market after parental leave (Frey 2002). Other analysts argue that it is not so much the lack of childcare facilities, but their short, inflexible opening hours of these facilities that creates problems for working mothers (HCSO 2011b). To sum up, gender segregation in the local labour market may be explained by gender differences in education and by the fact that it is almost exclusively women who do care work in the families, which in turn limits their opportunities in the labour market. 6 Including those women who had another or more children in this nine-year period 21

3. Forms of local coordination of the labour market (approx 2000 words) Please provide the description of the typology of work-contracts (permanent, fixed-term contracts, self-employment etc...) framing the labour market in your country. Although local experts have stated that the rate of fixed-term employment and employment is on the rise in the city and the region, figures from the Labour Force Survey show that the rate of these fixed-term contracts is lower at NUTS 3 level than nationally. According to the urban level estimate based on the LFS, it seems that the rate of fixed-term contracts is the same, or slightly lower at city level than at NUTS 3 level (Annex Table 1.3.6). Employment through private employment agencies is often as short-term as one month, which is either renewed or not at the end of the month (interview with the head of the local employment office and with the local trade union representative). According to trade union representative, the unionization among agency workers is very low, which prompted unions to initiate a negotiation process with employment agencies, trying to achieve some kind of co-operation. However, based on the Labour Force Survey, the proportion of workers employed through agencies is below 1 %. Five per cent of employed women and 9 % of employed men worked as self-employed at NUTS 3 level in 2010 (Annex Table 1.3.6). At the urban level, an estimated 11.6 % of men employees and 8.6 % of women employees were self-employed. This is practically the same level as measured by the 2001 census, when 11 % of employed men, and 7,1 % of employed women were self-employed in 2001. There is no significant difference in labour regulations in the public and private sectors. 7 However, public sector employment is generally considered more stable, as fast changing market forces do not affect these jobs. There also used to be a number of fringe benefits paid to employees in the public sector, such as a fix yearly bonuses and longer holidays, but these benefits were cut in 2009 as part of an austerity package. The most important 22

difference lies in the extent to which labour regulations are followed by employers in the public and the private sector. According to the local employment office and the trade union representative, it is small and medium sized companies in the private sector where labour laws are most likely to be violated. These violations are motivated by an attempt to keep labour costs low, and are explained by the relative lack of capital in these companies and also by the lack of strict enforcement of labour regulations. What is the general level of unionization of women and men? Please provide information about unionization trends (over the last decade): a) in the economic sectors where women are particularly concentrated; b) public/private companies; c) big/medium/small companies Trade unions in Hungary are weak and fragmented, and their prestige is generally quite low, due to a number of reasons, among them a backlash against ineffective, window dressing trade unions during state socialism. Different trade union confederations are also associated with different political parties. According to the representative of the largest trade union confederation (MSZOSZ) in Szekesfehervar, the level of unionization in the city is low, approximately 20 % of employees are members. However, this rate is higher, around 30 %, in large manufacturing companies, such as Philips or Visteon. According to our source, there are somewhat more women than men members of their trade union confederation in the city. What kinds of social protection are guaranteed to workers in your city? Please consider the following possible benefits and describe: eligibility criteria, level of coverage, adequacy of the benefits in respect of the need, specific forms of limitation or exclusion concerning women All workers in Hungary are entitled to a minimum wage, agreed on by the social partners every year. At the moment it is 280.63 Euros (Eurostat). Unemployment benefits also apply to all workers without gender distinctions. Over the last two decades the eligibility criteria 7 In 2010 new labour regulations were proposed for employees in government offices, and a new category, government employee was created. However, these regulations have not yet entered into force at the moment of writing this report. 23

have become stricter, and further restrictions are planned for 2012. The current unemployment benefits are as follows: Table 6 Unemployment benefits in Hungary Eligibility Length Replacement level Job seeking benefit Employment for 365 days during the previous 4 years, Maximum of 270 days, but it depends on the duration of previous employment 60% of former wage (the first 90 days), 60% of minimum wage (for the remaining days) Job-search Those who are no 90 days (over 40% of the minimum allowance longer eligible for a 50years, 180 days) wage job- search benefit, or only have been employed for 200 days during the previous 4 years Source: Nagy, 2010 According to existing regulations, workers should be paid extra for evening and night shifts and working overtime. Women are not allowed to work under some conditions deemed dangerous, and there are also special regulations about the work conditions for pregnant women. Jobs are secure while a worker is on maternity/parental leave and for an additional 30 days after returning from parental leave Eligibility for parental and care leaves are almost exactly the same for men and women. There is only one kind of benefit (birthing benefit), which is available for mothers only, 24

although fathers can receive the benefit under special circumstances. Despite the gender neutral eligibility criteria, very few men take parental leaves. Another aspect of parental leave policies that several researchers have pointed out is that the long leave - up to 3 years - is a double edged sword: it does not support the combination of waged work and private life, and also undermines the core values of gender equality policies and reinforces the traditional gender order (Frey 2002, Nagy 2010). According to Nagy (2010), Hungarian employment policies lack a systematic approach toward detecting and resolving gender inequalities in the labour market. Still, there are some policies aimed at women s labour market reintegration, especially since the country became an EU member state. These fall into three categories: 1. In the framework of the Human Resource Development Operative Programme (HRD OP) two special tenders have been called to improve women s labour market position. One of them focused on increasing women s economic activity, while the other one focused on female self-employment, by supporting training, networking, and other related skills for women setting up businesses. 2. There are special incentives for employers to hire certain groups of women. Employers are granted a special reduction in health and social insurance contributions in some special cases, for example, when employing mothers of young children. In the case of part-time work, employment policy tries to encourage employers by offering a 50% reduction in social insurance contributions if they employ parents returning to work from full-time childcare or the care of an elderly person. 3. As part of work-life reconciliation policies, parents can work up to 30 hours a week and continue to receive parental leave payment once the child is over the age of one. Have there been deliberative/neo-corporative processes at the local level aimed at regulating or improving the labour market participation of women and /or their level of social protection? Please provide summary information about the actors involved and evaluate the actual impact of such actions on women employment in your city. 25

There has been no such process aimed at regulating women s labour market participation or their level of social protection. According to the trade union representative, there was an initiative at city level between 2005-2007 within the framework of the Human Resource Development Operative Programme, initiated by employers organizations, trade unions and the local government with the aim of increasing employment in the city and in the NUTS 3 region. Women were one of the target groups, together with older employees, people with disabilities and the long-term unemployed, due to their low employment rate. The main aim of the project was to share information and enable employers and job seekers to find each other, and a website was set up for job advertisements (Labour market Partnership Szekesfehervar). The website is still working, and currently has 60 open positions and almost 500 registered job seekers. In sum, although women represent a group of employees with special needs, their needs are rarely taken into account systematically. Although there are a few programmes aimed at improving women s labour rmarket status at national level, at the local level such programmes do not exist. 26

References Balint Monika, Janos Kollo. 2007. A gyermeknevelési támogatások munkaerő-piaci hatásai. in MTA Munkaerőpiaci Tükör. Bukodi, Erzsebet. 2005. Women s Labour Market Participation and Use of Working Time. In Changing Roles: Report on the Situtation of Women and Men in Hungary 2005, edited by Ildiko Nagy, Marietta Pongracz and Istvan Gyorgy Toth. TARKI: Budapest. European Commission. 2007. Indicators for monitoring the Employment Guidelines, 2007 compendium. Available online at: https://woc.uc.pt/feuc/getfile.do?tipo=2&id=4534 Eurostat, data on minimum wages, Hungary. http://epp.eurostat.ec.europa.eu/tgm/table.do?tab=table&init=1&language=en&pcode =tps00155&plugin=1 Fodor, Eva. 1997. Gender in Transition: Unemployment in Hungary, Poland and Slovakia. East European Politics and Societies, 11, 3, 470-500. Fodor, Eva. 2003. Working difference: Women s Working Lives in Hungary and Austria, 1945-1995. Duke University Press: Durham. Frey, Maria. 2002. A gyermeknevelesi tamogatasokat igenybe vevo es csaladi okbol inaktiv szemelyek foglalkoztatasanak lehetosegei es akadalyai. [Opportunities in and obstacles to the employment of people on child care leave and other economically inactive people] Summary of the project PHARE HU9918-13 Fultz, Elaine and Silke Steinhilber (eds). 2003. The Gender Dimensions of Social Security Reform in Central and Eastern Europe: Case Studies of the Czech Republic, Hungary and Poland. Budapest: ILO Subregional Office for Central and Eastern Europe. HCSO 2003a 2001. Evi nepszamlalas. Teruleti adatok. Fejer megye. Az adatok ertekelese. (Census 2001. Local level data. Interpretation of data). HCSO: Budapest HCSO 2003b Fejer megyei statisztikai tajekoztato (Statistical Information about Fejer County). HCSO: Szekesfehervar HCSO 2004 Fejer megyei statisztikai tajekoztato (Statistical Information about Fejer County). HCSO: Szekesfehervar HCSO 2005 Fejer megyei statisztikai tajekoztato (Statistical Information about Fejer County). HCSO: Szekesfehervar HCSO 2006 Fejer megyei statisztikai tajekoztato (Statistical Information about Fejer County). HCSO: Szekesfehervar 27

HCSO 2007 Fejer megyei statisztikai tajekoztato (Statistical Information about Fejer County). HCSO: Szekesfehervar HCSO 2007a. Foglalkoztatottsag, Keresetek a Kozep-Dunantulon. (Employment and wages in the Central Transdanubia). HCSO: Veszprem HCSO 2007b. A brutto hazai termek (GDP) megoszlasa 2005-ben. (The distribution of gross domestic product in 2005). HCSO: Veszprem HCSO 2007 c Employment and Earnings 1998-2005: Labour Statistics. HCSO: Budapest HCSO 2008 Fejer megyei statisztikai tajekeztato (Statistical Information about Fejer County). Online publication HCSO 2010 Fejer megyei statisztikai evkonyv. (Statistical Information about Fejer county). HCSO: Veszprem HCSO 2010b A foglalkoztatas es a munkanelkuliseg regionalis kulonbsegei 2009. (Regional differences in employment and unemployment 2009) HCSO: online publication HCSO 2010c A valsag hatasa a munkaeropiacra (Labour market effects of the economic crisis). Online publication HCSO 2011a. Statisztikai Tajekoztato Fejer megye (Statistical Information about Fejer county) 2010/4. online publication HCSO 2011 b Munkavegzes es csaladi kotottsegek (Paid work and care responsibilities). Online publication. Individual Earnings Survey Állami foglalkoztatási Hivatal National Employment Service Munkaeropiaci Partnerseg Szekesfehervar [Labour market Partnership in Szekesfehervar] http://mupsz.szekesfehervar.hu/index.php Nagy Beata. 2010. The gender implications of labour market policy during the economic transformation and EU accession. A comparison of the Czech Republic, Hungary, and Slovenia in: Klenner, Christina - Leiber, Simone (eds): Welfare States and Gender in Central-Eastern Europe (CEE). ETUI, Brussels. 329-361. 28

Annex List of Annex Tables 1.1.1 GDP per inhabitant at current prices in Euros 1997-2008 1.1.2 GDP per employed at current prices in Euros 1995-2008 1.2.1 Distribution of employees by macro-economic sectors at urban level, 2001 1.2.2 Distribution of employees by economic sectors at national, NUTS2 and NUTS 3 levels 1995-2010 (%) 1.3.1 Participation in the labour market by gender aged 15-74 at the urban level, 2001 1.3.2 Distribution of employed people by age and gender at the urban level, 2001 1.3.3 Labour market participation by gender, 15-74 at the urban level, 2010 1.3.4 Trend in unemployment at urban level, population aged 15-74, 1990-2010 1.3.5 Trends in employment and labour force participation of people aged 15-74 by gender at NUTS 2, NUTS 2 and national level 1.3.6 Trends in type of employment of people aged 15-74 by gender at NUTS 2, NUTS 3 and national level 1.5.1 Annual gross salaries of full-time employees by gender at urban level 1.5.2 Annual gross salaries of full-time employees by gender at NUTS 3 level 2.1.1 Distribution of employees by economic sector and gender at urban level in 2001 (%) 2.1.2 Distribution of employees by economic sector and gender in sub/sectors at urban level, 2009 (%) 2.1.3 Distribution of employees by economic sectors and by gender, at NUTS 3 level, 2009, 2010 (%) 2.1.4 Distribution of employees by occupational categories and gender at urban and NUTS 3 level, 2001 (%) 2.2.1 Annual gross salaries by gender and economic sub/sector at the urban level, 2009 2.2.2 Annual gross salaries by economic sectors and gender at NUTS 3 level 2009 2.3.1 Population aged 15-64 by the highest level of education completed at urban level, 2001 and 2010 2.3.2 Population aged 15-74 by gender and highest level of education completed at NUTS 3 level, 1995-2010 29