There are many situations in which observable characteristics of persons are used to allocate resources, opportunities and powers. Allocation of more responsible jobs for educated people, consideration of school background at interviews are common experiences in this regard. In this context, Michael Spence (1972) describes this in terms of asymmetric information. Spence describes that people use observable characteristics to guess unobservable qualities of the unknown parties. Spence further identifies two types of observable characteristics; signals and indices. Both are observable but the former can be altered by the person possessed it and the latter cannot be changed. Whether the person like it or not, will have to live with that.

Michael Spence wrote that in real world, both signals and indices are used to guess unobservable characteristics. He further argues that use of signals can be efficient under certain conditions because the bearer can change it when he (she) wishes to do so. However the latter leads to discrimination and hence inefficient and unfair distribution of resources. Therefore efficiency and fairness require non-discriminatory state of affairs. There are many different forms of discriminations in the real world. Gender, ethnicity and color are the most prominent sources of discrimination in the present world. Among then gender-based discrimination is widely studied and discussed.

Gender discrimination means different treatment based on gender. In other words different treatment for men and women who are otherwise identical. In this situation femininity is stigmatized. In a society with gender-based discrimination, resources, opportunities and powers are distributed unevenly. Women get always less than what men get. This can be observed at many different levels. At household level it is argued that distribution of bequeath, distribution of meals and decision making power all favour male counterparts in the family. Same situation could be expected in labour market, society and even in politics.

Empowering women is identified as long lasting solution to this. What is meant by empowerment of women? There are many definitions of empowering women. In general, all definitions would agree that empowerment of women simply means that they are given enough bargaining power at household level and in the society such that they can effectively engage in any situation and insists the solutions which are at least not unfavorable for women.

There are many different methods and forms of empowering women. There are legal empowerment strategies where certain laws and regulations can be imposed to safeguard “women’s rights”. This will empower women for legal actions against those who violate women’s rights.

Education and awareness campaigns also help in this context. Provision of education for women always improves the situation. Increasing awareness of women’s rights among both genders is another strategy in this context. Formation of women interest groups to lobby for women friendly environment is also an accepted strategy in this context.

Economic empowerment, provision of economic opportunities and sources of income, can be considered as one of the most effective sources of empowerment. When women are with their own source of income and means of life, their reliance on men will decrease and thereby women will be independent of men. Therefore, many strategies are used to improve the economic empowerment of women. Provision of job market related education for women, special policies to recruit women workers and provision of self employment opportunities (training and finance) for women are the most popular strategies in this context.

Economic empowerment strategy is based on simple assumption that women are powerless in the present social system because they have to depend on male counterparts on economic matters.

In this context it is interesting to examine the situation in Sri Lanka. In Sri Lanka, the female labour force participation rate (FLFPR) was 20 percent in 1960’s. In 2007, the FLFPR has exceeded 30 percent. What does this mean? Out of every 100 women of age 15 to 65 in Sri Lanka 30 women either seeking jobs or are already employed. Unemployment rate of female workforce has decreased from 20 percent in 1950’s to 5 percent in 2007. What does this mean? In 1950’s nearly 16 percent of women in eligible age group were employed. This percentage was increased nearly to 30 percent in 2007. Nearly 30 percent of women in eligible age group are employed and have their own source of income.

Whether this 30 percent of women are empowered now is an interesting question. They may be empowered as compared to the 70 percent of women unemployed and not in labour force. However labour market segregation by gender shows clearly that the economic empowerment is not completed. It is still observed that female workers are highly concentrated in relatively low skilled employment categories.

The Quarterly Labour Force Survey of the Department of Census and Statistics shows that this pattern is now changing. For example, in 1975 less than 10 percent of administrative and managerial level employees were female.

In the same year over 40 percent of unskilled category employees were female. The same source shows that the situation is now changing. In year 2002 for example, female percentage in administrative and managerial level occupations has increased to nearly 20 percent. Female percentage in unskilled category has further gone up. Female percentage has particularly increased in administrative, professional and clerical level occupations. However still majority of women are in relatively low skilled occupational categories. This situation is particularly observed in some industries. For example, Ranasinghe (2008) has reported that in ready made garment industry, only two percent of female workers are in managerial and professional level occupations. Over 80 percent of female workers are in skilled and semi skilled categories.

In addition to that “wage-gap” between male and female workers is still high. According to the same source, on average female worker in ready made garment sector earns nearly 55 percent of the salary of average male worker in the same sector. University of Colombo and ILO survey on Socio-economic security conditions of employees in Sri Lanka shows that nearly 30 percent of enterprises interviewed prefer male workers. They consider hiring of female workers can be an additional obstacle due to legal requirements.

Another interesting case was also found in microfinance literature. In that the argument is that provision of more microfinance opportunities for women has not solved the problem. Some studies report that female microfinance businesses are less successful in handling loans because their husbands or brothers use the borrowed money and microfinance business women cannot pay it back in time.

Careful examination of these suggests that the economic empowerment is not fully achieved through labour market. Women in labour market have more and gender specific problems than their male counterparts are having. Therefore now scholars are talking about empowering working women instead of empowering women through labour market opportunities. Therefore it is our belief that this is the next challenge for women activists, trade unions and other stakeholders to address the issue of empowering working women.