Estonia hits NATO target on defense spending, but lags on gender equality

For some 300 years, Estonia's history has been closely tied to its giant neighbor to the east, Russia. But when it comes to identity, many Estonians see themselves as Nordic. 

That sounds like a stretch. In fact, Estonians are very closely related in language and ethnicity to the Finns, just 50 miles north, and have shared history with Sweden. Both are among the richest and most egalitarian societies in Europe, making Estonia's an aspirational goal. 

Yet despite their dreams of Nordic egalitarianism, Estonia comes in last in European Union (EU) gender pay parity, behind even fellow post-Soviet states Latvia and Lithuania with no such aspirations. According to government data, Estonian men earn one quarter more than their female counterparts, and the gap is widening.

The most prosaic explanation for the disparity is career paths: Estonia’s well-paying IT sector, which spawned Skype, is dominated by men.

“One of the sectors with the highest pay rates in Estonia is IT, with program developers in the lead,” says Terje Toomistu, a doctoral researcher who studies gender issues at the University of Tartu. “Women are more likely to work in the area of care – social workers, educators, caretakers – with...smaller salaries.”

Careers are one reason. Another is Estonia's failure to build a strong welfare state, a staple of the Nordic model. Budget priorities mean that single mothers receive as little as $25 a month per child.

Yet while Estonia is miserly on social spending, it has hit NATO's target for spending 2 percent of GDP on defense, one of only three European NATO members to do so. 

As a small country on Europe’s frontier, Estonia has sought security in institutions like NATO and the European Union. The trade-off appears to be a failure to pay for the generous subsidies of the Nordic model, such as free childcare.  

Estonia’s new government, headed by Prime Minister Taavi Rõivas, has shown signs of a more flexible approach to social issues, including increases in pensions and child allowances, says Karsten Staehr, professor of international and public finance at Tallinn University of Technology. "Most of the new measures could be seen to move Estonia in the direction of its Nordic neighbors." 

The effect of traditional gender roles

However, such policies still run up against traditional attitudes towards gender relations, including among politicians like Mr. Rõivas. As former Minister of Social Affairs, he opposed the idea of a quota for women in corporate boardrooms. “A Europe-wide quota seems a completely inappropriate measure, which in Estonia’s context would definitely not yield the desired results," he told a public broadcaster last year. 

Mr. Staehr points out that the government's new spending commitments are modest and that income tax is also being cut at the same time. "The government budget will still be balanced and Estonia will retain its position as the EU country with the lowest debt-to-GDP ratio," he says. 

In Estonia, men are still widely expected to be the family breadwinners, says Ms. Toomitsu. “Women are assumed to be the hardworking ones, who can manage their double-job between work and home. No wonder we say in Estonia that poverty has the face of a single mother.”