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Women do better in wage-terms

The income-systems of the North are rapidly changing. The issue of wage-labour for women is thus of increasing importance. The general income level in the Arctic is relatively high. Typically the largest incomes are to be found in the largest settlements at levels comparable to Northern European standards. Incomes in the smaller settlements are, on the other hand, substantially lower.

There are marked differences in the welfare model used in different parts of the Arctic. The main difference is in relation to the sources of income transfers. Greenland, the Scandinavia countries and partly also Canada are all dominated by the welfare model and have transfers based on high taxes and public invol-vement. In Alaska, however, transfers are basically based on private sources and public revenues from the oil industry. The Russian North which, during Soviet times, was dominated by substantial public incentives in order to attract southerners to relocate North, has for the last 10 years, undergone something of a transition period. This has resulted in limited transfers and dwindling wages, eventually triggering massive out-migration from the region.


Economies in the North are not determined by the somewhat one-dimensional system of capital/wage and transfer payment rationality. In addition to the dominant formal economy, the informal economy and subsistence activities continue to play an important role particularly in respect of individual and family-based activities such as hunting and fishing. These activities do of course also reflect traditional social and cultural values.

The informal sector is in this context defined as subsistence activity which is sold (or exchanged) in a local market or between people, but is not formally registered, for example, through taxation. It is located somewhere between the subsistence economy, i.e. hunting and fishing for oneself or one's own family, and the formal economy. Products from hunting and fishing are of course usually also transferred to the formal sector in addition to being consumed privately. As such then, the informal economy provides a link between the two economic sectors. In fact, one could argue that in an Arctic setting the distinctions between the subsistence and cash-based economic sectors are more or less artificial and meaningless, as the two sectors are thoroughly interwoven.

Extensive descriptions of informal and subsistence activities and their social and cultural characteristics are usually available through ethnographic and anthropological presentations of live-lihoods in the North. Detailed analyses of the real, or formal, economy remain however rather sparse. In recent years however a more thorough analysis of the economic role of the various sectors in Greenland has been conducted. The result of this analysis also provides an indication of both the relative and the absolute magnitude of the scale of these informal economic activities in relation to that of the formal economy.

Women generate most

Natural resource exploitation is still considered to be the main economic basis for communities in the North. However the reality is that the 'third sector', namely, services with wage work in administration, education, the social service sector etc, is now the main income source for most families. Such incomes have in fact become necessary for the maintenance of many of the traditional renewable resource activities. Hunters and fishermen in Greenland are increasingly dependent on supplementary wage work. In a family context, women are becoming the main income resource, typically from their work in schools, kindergartens, public and private administration, cleaning etc. In Greenland 24% of hunters and fishermen have incomes from other activities. In more than 70% of households however women contribute to the family income, and in more than 50% of families the major income source is generated by women.

In Greenland, as elsewhere in the Nordic Countries, transfer payments have become a substantial part of the welfare economy, including funding for the maintenance of a public system of schools and health services, but also including pensions, childcare, housing support, different types of social services, and to some extent, the maintenance of the technical, social, and cultural infra-structure. In many small settlements where out-migration has resulted in an age structure dominated by pensioners, the main cash-income source is often pensions.

However, the subsistence economy and other informal economic activities also contribute substantially to family incomes. There are several types of such informal and subsistence activities, namely; informal sale to relatives, neighbours, on local markets, to institu-tions etc., as well as sharing with family and neighbours. In fact, in many communities both subsistence activities and informal sale may be decisive for the continuation of hunting and fishing, providing for basic sustenance and a small cash income.

The role of the different activities, depending on the settlement size, is illustrated in the graph see figure A (page 18), showing the distribution of the main types of informal activities in villages – typically settlements below 500 inhabitants.

In the towns local market sales dominate activity, providing fresh products to the local inhabitants, and not only through local hunters and fishermen. Often products from nearby villages will be brought to market in the larger towns. In the villages, however, subsistence activity and the re-distribution of products to family, friends and neighbours remain among the most important activities. When comparing the two columns it is however important to bear in mind that the village population is around 10000 inhabitants while the number of inhabitants in towns is around 47000 persons.

So even though the absolute value generated from towns and villages remains at more or less the same level, the average economic contribution per capita of the inhabitants of the villages is five times that in the towns. Basically, villages would not be able to exist without the existence of such informal and subsistence-based activities.

In addition to differences in the importance of such activities between towns and villages, regional differences are also quite marked. The graph contained in figure B shows the main forms of income for three different municipalities in Greenland: Sisimiut on the West-coast, one of the largest towns with a thriving and self-sustaining economy; Paamiut, also on the West-coast, which used to be a centre for cod processing, but after the cod disappeared the town has fallen into a steady decline, and is thus now a highly dependent economy; And finally Tasiilaq on the East-coast, a town which has never been an integrated part of the general Greenland economy, and therefore can be characterised as a 'detached' economy (see Map, page 15).

In the town of Sisimiut the major income sources are from wage earnings, partly from working on the trawlers and in fish plants etc., but mainly in connection with other land-based activities. Transfers add to this, as do contributions from the formal sale of fish products. On top of this there are contributions from the informal sale, especially to the local market, and finally from subsistence production. In Paamiut incomes from wage work contribute to the economy, but they are only just balanced by transfer payments. There is a small contribution from the formal sale of fish products, some informal sale on the local market and to other institutions, and a much higher level of subsistence production. And finally, in Tasiilaq the three sectors – formal incomes, transfer payments, and informal and subsistence activities are almost equal in size. Subsistence produc-tion in particular is decisive for the individual economy as compared to the other two places.

Rasmus Ole Rasmussen

Senior Research Fellow


Figure A: Main characteristics of the informal sector in towns and villages in Greenland

Figure B: Main characteristics of income structure in three municipalities in Greenland

Selected reading on the topic

Dahl, J. (1989): "The Integrative and Cultural Role of Hunting and Subsistence in Greenland". In Études/Inuit/Studies, 13(1): 23-42

Duhaime, G., Fréchette, P., Robichaud, V. (1996): "Changes and Stability in the Economic Structure of the Nunavik Region (Canada)". Department of Agrifood Economics and Consumer Science, Édifice Paul-Comtois, Université Laval, Quebec.

Duhaime, G., Rasmussen, R.O. et Comtois, R. (1998) "Sustainable Development in the North: Local Initiatives vs Megaprojects". Proceedings of the Second Circumpolar Social Science Ph.D. Network Conference, held in Aguanish, Québec, 1997. GETIC, Sainte-Foy, Presses de l'Université Laval.

Gromsrød, S. and Aslaksen, I. (2007): "The Economy of the North", Oslo, Statistics Norway.

Marquardt, O. and Caulfield, R. A. (1995): "Development of West Greenlandic Markets for Country Foods Since the 18th Century". Arctic 49(2): 107-119.

Rasmussen, R. O. (2005): Socioøkonomisk analyse af Fangererhvervet. Grønlands Hjemmestyre og Roskilde Universitetscenter. NORS forskningspublikationer.

Rasmussen, R. O. (2007): "Adjustment to reality - Social response to climate changes in Greenland", In:. Arctic Alpine Ecosystems and People in a Changing Environment. Berlin Heidelberg New York: Springer.

Rasmussen, R.O. (2007): "Gender and Generation Perspectives on Arctic Communities in Transition". In: Knowledge and Power in the Arctic. Arctic Centre, Rovaniemi.

Tommasini, D., & Rasmussen, R. O. (2006): "Adapting to change: Cases of detached, dependent, and sustained community development in Greenland".. State of the Arctic: Current State of the Arctic – Observations of Arctic Change. Fairbanks