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Archive for March 2018

Bad boys, what you gonna do?

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Bad-Boys

A social revolution is underway that most of us are blissfully unaware of. Its causes are fuzzy, but its consequences are likely to be significant: it could radically alter how we work, whom we marry, how many children we have, and, perhaps in the extreme, the likelihood of conflict. This social revolution is a relatively recent phenomenon. We’ve seen it emerge only in the last two decades, but it’s accelerating at a rapid pace. Welcome to the era of the widening gender gap in education.

Girls, nowadays, outperform boys at astonishing rates, both at school and at university. Two new studies, both by economists at Stellenbosch University’s Research in Social Policy unit, attest to this. First, a study by Chris van Wyk, Anderson Gondwe and Pierre de Villiers follow all 2007 Western Cape Grade 6 learners (77,633) until matric in 2013. They find that men are 29% more likely to have dropped out of school by 2013 compared to their female counterparts. These results confirm nationally representative studies of reading and math scores. Hendrik van Broekhuizen and Nic Spaull show that the gender gap in reading at South African primary schools is one of the largest in the world. But it is also in mathematics, a subject where boys traditionally outperformed girls, where the closing and then widening of the gender gap is most evident. Says Van Broekhuizen and Spaull: “In the 2000 and 2007 rounds of SACMEQ, South African grade 6 girls outperformed their male counterparts, but this difference was not statistically significant. However, in the more recently conducted TIMSS-Numeracy assessment of 2015, grade 5 girls outperformed grade 5 boys by a statistically significant margin of 16 points. This was the fourth largest (pro-girl) gender gap in mathematics of the 49 countries that participated.”

SchoolPerformance

Source: Van Broekhuizen and Spaull (2017)

Not only do girls do better than boys at school, women outperform men to an even greater extent at university. Van Broekhuizen and Spaull follow the 2008 matric cohort, and show that, while girls obtained 27% more bachelor passes in matric, more females access university (34% more), and considerably more females complete any undergraduate qualification (56% more) or any undergraduate degree (66% more). These gaps exist for all of South Africa’s race groups, although it is slightly bigger for white and coloured students. The pyramid summarizes the gap at every level: for every 100 females in matric in 2008, there were only 8 females that earned any undergraduate degree by the end of 2014, and only 5 males.

We don’t yet know what explains this gap. One argument, with some supporting evidence, is that women have more traits and behaviours that are favourable to schooling in its current form, also known as non-cognitive skills. These skills include self-control, self-motivation, dependability, sociability, perceptions of self-worth, locus of control, time-preference and delayed gratification. But why exactly these non-cognitive skills have become more valuable in the last two decades is not entirely clear. Others have pointed to technological change, particularly in computer and video games, as an explanation for why men are performing worse. But that does not explain gender differences at very young ages.

What is more interesting, though, is to think through the likely consequences. The most obvious is the effect on the job market. Graduates have a much lower unemployment rate (5%) compared to those without any tertiary qualification (33%) in South Africa. If more women have degrees, women are likely to have significant lower unemployment rates than men. And because the best students in almost all subject fields are now women, they are likely to find the best jobs, and move up the job ladder quicker.

We know that men have historically held the majority of high-ranking positions in the workplace, and this outcome can do a lot to balance things out. But it is also important that we think carefully through the full range of consequences. People prefer to match on education, meaning that women prefer men with a similar level of education, and vice versa. What does the gender-unbalanced pool of graduates mean for finding your soulmate? If women become the main (or only) breadwinners, how will that affect family planning? Women already face a more difficult trade-off than men between having to balance a family and career – will this cause fertility rates to fall further, especially for those at the upper-end of the income distribution where the gender gap is most pronounced?

And what of the men? Will they be happy to step in and take up more of the family responsibilities? In a world that increasingly rewards human capital, a large pool of unskilled men will find no outlet for their only productive resource: manual labour. If these men, without proper interventions, become more indolent and isolated, what are the likely political and social consequences? It is not surprising that the political extremes are often dominated by men. Men already outnumber women in all major crime categories. If unchecked, violence and conflict, at the household, community and international level, will in all likelihood increase.

It is natural to ask what can be done about this. Those who argue that the cause for the gender gap is the sudden increase in rewards for non-cognitive abilities would argue that the schooling system can do more to nurture these traits in men. Others would argue that the technological change that make men less productive – like video games – should be taxed.

Others, again, will say that it is pointless to intervene – why should we care about men when women have been suppressed for centuries, and many remain the victims of abuse and dominance? I would argue that that is exactly why we should care about the rising gender gap in education: if we don’t, the consequences are likely to be dire, for men and women.

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Written by Johan Fourie

March 26, 2018 at 08:30

The formula for success

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The world of work is changing. Skills that were valuable only a decade or two ago seem less valuable nowadays, displaced by newer trends and technologies. Every few weeks a news article report on the threat of automation, and how it will destroy millions of jobs, including yours. A YouTube video of a robot jumping over obstacles confirms that the inevitable is only a few months away.

The answer, many seem to think, is to become like computers. Students, in South Africa and elsewhere, are encouraged to pursue STEM – science, technology, engineering and mathematics – careers. Humanities degrees or those in the social sciences, in contrast, are often considered less prestigious. We know that the best-paying jobs are still those where a decent amount of math is required. In South Africa, this is of particular concern, as the gender and racial composition of those enrolling for STEM degrees differ significantly from those enrolling for degrees in the humanities, exacerbating inequality.

Occupations

But the story is more complicated than that. A new paper by David Deming, published in the Quarterly Journal of Economics (QJE), suggests that, at least in the United States, STEM graduates are not doing very well. In fact, between 2000 and 2012, STEM jobs shrank by 0.1 percentage points, after growing by 1.3 percentage points in the previous two decades. In contrast, all other ‘cognitive occupations’, jobs like managers, teachers, nurses, physicians, lawyers and economists , grew by 2.9 percentage points between 2000 and 2012, faster than the 2 percentage points in the previous decade. The figure below demonstrates this clearly: only 36% of STEM occupational categories had positive growth, compared to 85% of other professional occupations.

The reason for this, Deming argues, is that managers, teachers and physicians all require significant interpersonal skills. And because of the technological change – the same technological change we all fear! – these social skills are increasingly in demand. Deming explains: ‘The skills and tasks that cannot be substituted away by automation are generally complemented by it, and social interaction has, at least so far, proven difficult to automate. Our ability to read and react to others is based on tacit knowledge, and computers are still very poor substitutes for tasks where programmers don’t know “the rules”.’

Using a wide variety of sources, Deming finds that jobs that require high levels of both cognitive and social skills have fared particularly well, while high math, low social skill jobs (including many STEM occupations) have fared especially poorly. ‘Social skills were a much stronger predictor of employment and wages for young adults age 25 to 33 in the mid-2000s, compared to the 1980s and the 1990s.’ There is a revolution in the job market underway that no-one is talking about.

CyanideHappiness

Where do these social skills come from? Deming speculates that much of it is formed during early childhood development, although this is difficult to prove. The latest research that have followed children from a young age into adulthood have found strong correlations between kids’ socioemotional skills in kindergarten and adult outcomes such as employment and earnings.

The demand for social skills may also have implications for gender imbalances in the workplace. Women often choose careers that require more social interaction. If these jobs are in greater demand, with faster earnings increases, the gender gap may close quicker.

The optimism about the closing of the gender gap, though, is pegged by another study published in the same journal, by authors Matthew Wiswall and Basit Zafar. They test a group of New York University students about their preferences for flexible hours when they enter the job market, and find that students are willing to give up 2.8% of their annual earnings for a job with a centage point lower probability of job dismissal. They also find that students are willing to give up 5.1% of their salary to have a job that offers the option of working part-time hours. But there is a large gender difference: female students have a much higher average preference for flexible hours – 7.3% – compared to men – 1.1%. What the authors then do is to track the students after they graduate, and record their actual earnings four years later. Wiswall and Zafar find that those students with a high preference for work flexibility do actually end up in occupations with greater flexibility. But because women already prefer more flexible work even before they’ve started working, they also tend to earn less once they’ve entered the labour market, choosing jobs with lower pay and greater flexibility. At least a quarter of the gender gap in the labour market, the authors argue, can be explained by just these differences in preference.

These studies show how our social skills and preferences affect our labour market outcomes. Policies that aim to address labour market distortions, like race or gender gaps, should know that the roots of the problem may lie in preferences and skills moulded in the early years of development.

That is not to say that nothing can be done: for those going to university this year, perhaps one thing to keep in mind is that your future earnings depend not only on attending math class, but also on developing your social skills. Here’s one formula to remember: Math + beer = success.

>>> An edited version of this article originally appeared in the 1 February 2018 edition of finweek.

Written by Johan Fourie

March 13, 2018 at 08:00