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Ending poverty demands a level playing field to unleash women’s economic potential
WASHINGTON—“The future is grim for us women smallholder farmers,” a group from Togo told a UN global consultation on future development goals. In keeping with local custom, they said, “Only men inherit land, although women do most of the work in fields. This keeps us dependent on men and shackles us in poverty.”
The World Bank Group’s 2012 report On Norms and Agency—the largest-ever qualitative study of gender and development—gathered similar insights. A woman “can get property, but she can’t own property,” one Liberian man said. “Even the woman herself is your property.”
Discriminatory laws represent one of many obstacles holding back women’s economic participation, hindering development and keeping millions of people in poverty. Social norms, lack of autonomy, and limited access to assets all play a part, and the costs—particularly in poor and emerging countries—are steep.
By virtually every measure, women are more economically excluded than men. Gains in women’s labor force participation worldwide over the last three decades have been small and slow, hovering around 51 percent but as low as 21 percent in the Middle East and North Africa. Globally, men are nearly twice as likely as women to have “good jobs”—full-time employed positions—while in South Asia, they are more than three times as likely.
Gender gaps are pervasive across continents and sectors. Female farmers tend to have lower productivity, farm smaller plots, and grow less profitable crops. Female employees are more likely to work in temporary and part-time jobs, less likely to be promoted, and overrepresented in occupations and sectors with lower barriers to entry. In Mexico and Honduras, women accounted for 70 percent of all layoffs during the global economic crisis. Across advanced economies, women earn 16 percent less than men, even in the same occupations, hold fewer senior positions, and account for fewer entrepreneurs.
According to Ernst and Young, some 860 million women are “not prepared” and/or “not enabled” to take part in the world economy. The International labor Organization meanwhile estimates that almost half of women’s productive potential globally is unutilized, compared to 22 percent of men’s.
Closing these gender gaps could yield enormous dividends for development. A new study by the International Monetary Fund estimates that having as many women in the labor force as men could boost economic growth by 5 percent in the United States, 9 percent in Japan, and 34 percent in Egypt. A Goldman Sachs study finds that narrowing the gender gap in employment could push per capita income in emerging markets up to 14 percent higher by 2020.
Why gender inequalities at work persist
The World Bank Group will soon launch a new report, Gender at Work, which will highlight key challenges and opportunities for advancing gender equality in the world of work. It will ask hard questions about why such gaps persist despite enormous advances in female education in recent decades. Two-thirds of the World Bank Group’s partner countries have reached gender parity in primary education, and girls significantly outnumber boys in secondary education in more than one-third of those countries.
Our findings show that social norms are a key factor in underlying disadvantages throughout women’s lives. These constrain women’s time and undervalue their potential. Housework, child-rearing, and elder care are typically considered women’s responsibility, while nearly four in 10 people globally—close to five in 10 in developing countries—agree that, when jobs are scarce, men deserve priority.
Lack of agency—meaning the ability to make one’s own choices and act upon them—also restricts women’s job opportunities. In most developing countries, women have fewer choices in essential areas of daily life, including their own movements, health decisions, and whether and when to go to school or work. A huge number of women lack freedom from violence: The World Health Organization estimates that more than 35 percent of women have experienced gender-based violence—and the associated costs are staggering, in individual suffering as well as diminished job performance and lost productivity and earnings. In some communities, girls’ basic rights are violated and human talent development is disrupted by gender-based violence in schools.
Inequalities in endowments and assets also play a part. In 2010, girls were enrolled less than boys in primary school by at least 10 percentage points in 15 countries, mainly in Africa. Many women lack access to land and financial capital, as well as to financial services, technology, training, information, and social networks. A World Bank Group project, Global Findex, measures how people in 148 countries save, borrow, make payments, and manage risk, and it has highlighted alarming disparities. Only 47 percent of women globally, for example, have opened an account at a formal financial institution compared with 55 percent of men. The gap is greater in low- and middle-income countries. In South Asia, 25 percent of women have opened a bank account compared with 41 percent of men.
Legal discrimination remains extremely common. Our recent Women, Business, and the Law report found that, of 143 economies, 90 percent had at least one legal difference restricting women’s economic opportunities in 2013. These include barriers to women’s obtaining official identification cards, owning or using property, building credit, or getting a job. In 15 countries, women still require their husbands’ consent to work. In many economies, especially in the Middle East and North Africa, women face the cumulative effects of multiple legal constraints.
Level the playing field
The range of constraints highlights the need for bold, coordinated, multi-sectoral solutions to break out of stagnant inequality. Moreover, empowering women and girls can be catalytic in tackling poverty and boosting shared prosperity—the World Bank Group’s top corporate priorities. Women drive economic development and invest heavily in others. Their access to good jobs correlates with better outcomes, greater transparency, and more inclusive prosperity—the kind of economic growth that has lifted millions out of poverty in recent decades.
Overcoming inequality and empowering women at work means understanding local contexts and devising cross-cutting solutions to address deprivations and constraints. These will likely include:
--Eliminating legal and formal barriers to women’s work. Reforms should focus on removing restrictions on women’s labor and employment; removing women’s unequal status, such as through family law head-of-household provisions; allowing and encouraging women’s ownership and joint-titling of land; promulgating equitable inheritance laws; applying non-discrimination principles to customary laws; and, most importantly, ensuring these laws are implemented and enforced.
--Engaging the private sector. The private sector accounts for about three out of four jobs in countries such as Egypt, Finland, and France and nine out of 10 jobs in countries such as Brazil, Chile, Japan, and South Africa. Multinational firms increased profitability in South Korea by aggressively recruiting women for local managerial positions. Yet just 2 percent of employers report having adopted strategies to recruit more women in the 42 countries for which relevant data exist.
--Fostering female entrepreneurship. Women’s entrepreneurship can be advanced through a combination of increased access to capital, social networks, and new markets; high-quality business skills and development training; and access to broader services that offset gender-specific constraints. In Tanzania, a World Bank Group study found that 8 percent of women reported having participated in apprenticeship programs to support household entrepreneurs, compared with 16 percent of men.
--Removing and offsetting constraints across the lifecycle is necessary to ensure broad, sustainable impact: Focusing only on working-age women starts too late and ends too early. Biases can begin very early in life, sometimes subtly, starting trajectories of inequality that are increasingly difficult and costly to address over time.
For young people, policies can tackle inequalities through education and training—including development of aspirations and non-cognitive skills. For women of productive age, actions can focus on enabling their engagement in paid work: This means ensuring that women have the support and resources they need be as productive as men, and that women and men can share responsibilities more equitably between paid jobs and unpaid caring. In later years, governments can support equitable old-age labor regulations combined with social protection.
“When women and men participate in economic life on an equal footing, they can contribute their energies to building a more cohesive society and a more resilient economy,” World Bank Group President Jim Yong Kim has said. “The surest way to help enrich the lives of families, communities, and economies is to allow every individual to live up to her or his fullest potential.”
Eradicating extreme poverty is a bold target that will demand every asset we’ve got. Tackling inequality at work and unleashing women’s full economic potential—long overdue—will almost certainly be a game-changer.
See Harvard Business Review’s interactive Equality Matrix
--Jeni Klugman is director of gender and development at the World Bank Group. Matthew Morton is a social scientist in gender and development at the World Bank Group.
