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How gender equality can boost global GDP by $7 trillion

Shatakshi Asthana
By Shatakshi Asthana

4 min read | Updated on November 26, 2024, 15:27 IST

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SUMMARY

According to the Global Gender Gap Report 2024 by the World Economic Forum, it would take the world 134 years to achieve gender parity. While it is vital to bridge the gender gap to achieve the goal of gender equality, it would also provide a financial boost to the global economy.

Gender equality is essential for economies too, and not only for women.

Gender equality is essential for economies too, and not only for women.

When the United Nations General Assembly met in 2015, the member countries set 17 Sustainable Development Goals (SDGs), ambitiously hoping to achieve them by 2030. One of those goals was to achieve gender equality—to end all forms of discrimination and violence facing women and girls globally, to empower them enough to participate in decision-making processes and grant them equal opportunities in political, economic and social spheres. Almost 10 years later and just 5 years short of the deadline, the goal remains elusive.

In fact, according to the Global Gender Gap Report 2024 published by the World Economic Forum (WEF), it would take another 134 years to achieve gender parity worldwide. The economic gender gap is a whole other ball game, which will take 152 years to bridge, according to the WEF.

Even the 21st-century women lack the agency to participate in the economy. Based on data compiled from LinkedIn, women make up 42% of the global workforce, lagging behind men in several aspects, from equal pay to senior positions in corporate giants.

The WEF report illustrated how 50% of entrants at entry level are women, but only 25% make up the senior positions. Out of those participating in the workforce, nearly 60% are caught up in informal employment, with no social or even physical security (UN Women) . If they succeed in breaking the glass ceiling, the glass cliff awaits them- promoting women to leadership roles in times of crisis so that they are the ones to take the fall.
It all begins with the inability to access essential resources since 1 in 10 women globally is forced to survive in extreme poverty (UN Women). The Indian trend of feminisation of agriculture bears witness to the fact that when opportunities in the urban areas arrive, it is men who migrate to grab them.

The COVID-19 pandemic was particularly hard for women. They were at the losing end when it came to layoffs more than men. An INSEAD survey found that nearly 50% more women (5.3%) than men (3.6%) were affected by layoffs.

By not harnessing the potential of half the population, economies of the world are losing out on all fronts. According to WEF, gender inequality costs $12 trillion to global GDP. UN Women reports in its Gender Snapshot that the annual cost of failing to educate young women adequately is $10 trillion.

All the unpaid care work women provide in raising and maintaining labour for the corporations is a lost opportunity. The International Labor Organisation estimates the value of unpaid care and domestic work to be as much as 9% of the global GDP, with women’s contribution at 6.6% compared to men’s contribution at 2.4%.

Manifestations of gender-based discrimination lead to costs that could otherwise have been invested in positive directions. As per UN Women, the cost of violence against women alone could amount to around 2% of the global GDP.

According to the World Bank, the labour force participation rate for men is 80%, while only 50% for women. Bringing in the excluded women would benefit the global economy tremendously. A UN Women report states that closing the gender gap could give the global economy a $7 trillion boost.

Embracing diversity would be financially rewarding for individual companies as well. As per a McKinsey report, companies with more than 30% female representation are significantly more likely to financially outperform those with 30% or fewer women in the workforce.

Investment in female education builds a skilled and reliable workforce. Enrolling more girls in higher education, especially STEM fields, enhances their employability. On the road to bridging the gender gap, it is vital to tackle issues of the digital divide. Access to economic opportunities from within the safety of their houses could attract a significant section.

At the same time, ensuring safety outside the house has to be a big concern. Women quitting jobs due to unsafe workplace environments or routes to the workplace need to be kept in the workforce.

It can be done by effectively implementing the Protection of Women from Sexual Harassment (POSH) Act for safety at workplace, providing safer commutes, and introducing technology-based solutions. The advancement of women at work can potentially increase global GDP by 20%, according to the World Bank, and it could be one of the ways to bring half the world at par with the rest.

About The Author

Shatakshi Asthana
Shatakshi Asthana is a journalist focusing on business, environment and science. An alumna of St. Xavier's College, Mumbai, and IIMC, New Delhi, she looks at life though the prism of life sciences and journalism.

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