March 08th, 2020

Why Women’s Economic Empowerment Matters
by Geena Whitman Research Assistant Centre for Business, Society and Global Challenges
Oxford Brookes University
“Human rights are women’s rights, and women’s rights are human rights, once and for all.” Hilary Clinton

The world is not on track to achieve gender equality by 2030; one of the seventeen Sustainable Development Goals (SDGs) outlined by the United Nations in 2015. Based on current trends, it would take 257 years to close the gender gap in economic opportunity, despite the fact that women’s equal participation in the economy would add $28 trillion to the global economy (approximately 26% of global GDP). The movement towards women’s empowerment isn’t about strengthening women, women are already strong;  they raise households, lead communities and influence change whilst still being restricted a seat at the table. Women’s empowerment is about changing the way the world perceives, and values that strength, alongside ensuring women are afforded the same opportunities and privileges that men are. Investing in women’s empowerment, more specifically, their economic empowerment, sets the world on a direct path towards gender equality, healthier households, poverty eradication and truly inclusive economic growth. Whilst economic empowerment specifically relates to a person’s ability to work to create wealth, it indirectly links in with family planning, access to schooling, and the financial inclusion and political representation of women, all factors which contribute and enable women to break the barriers barring their seat at the table.

Family Planning
Family planning, the ability to control and plan your fertility, represents an immense extension of human freedom, allowing women to decide freely the amount of children they want, when they want them and how they want them. Growing rates of contraceptive methods has resulted not only in improvements in health-related outcomes such as reduced maternal and infant mortality rates, but also improvements in educational and economic outcomes, particularly for girls and women. Currently, more than one in ten married or ‘in-union’ women worldwide have an unmet need for family planning (i.e. they want to stop/delay childbearing but are unable to access the correct contraception); with this being as many as one in five women in Africa. Access to family planning not only ensures women can prevent an unwanted pregnancy, it also allows couples to have smaller families and to space the gap between children more efficiently, ensuring they are less vulnerable to extreme poverty, children are healthier and better educated, and women are able to re-enter the labour market if desired. Availability of family planning also has important incentive effects, by increasing parent’s investments into girls not yet fertile, such as daughters and granddaughters, including investment in their health, education and general well-being. The more access we have to family planning, the more opportunities we are given outside of potential motherhood. 

Girls Schooling
Educated women have a better chance of escaping poverty, leading healthier and more productive lives, and raising the living standards for their children, families and communities. Children born to literate mothers are less likely to die before the age of five than to illiterate mothers. They are more active in the formal labour market, have less children, marry at a later age, and engage more actively in civic spaces. However, less than 40% of all countries provide girls and boys with equal access to education, twice as many girls as boys will never even enter the school playground, and over two thirds of the 774 million illiterate people in the world are female. Keeping women in school keeps them away from early marriage, with girls who have completed seven years of education marrying on average, five years later than their uneducated peers. It’s no secret that the more educated a person, the higher salary they can command, with every extra year of education estimated to increase a women’s earning power by 10-20%. Educating women from a young age, keeping them in school for as long as possible and allowing them to access all breadths of academia (from social sciences to STEM) creates a society in which women are active citizens, engaged in innovation and at the forefront of decision-making processes. 

Women in Work
Throughout the world, women and girls bear most of the burden of unpaid household and care-work, are more vulnerable to insecure employment and receive lower pay for the same work as men, as well as a systemic under-valuing of feminised jobs (such as caring, teaching and nursing). In the 50 countries across the world where women are more educated than men, they still earn 39% less than their male equivalent counterparts. In the UK, PWC estimates a 16.4% gender pay gap, with women disproportionately more represented in part-time precarious employment and working outside the labour market (such as in unpaid labour). UN Women estimates that 57 million people (majority being women) supply full-time, unpaid work (such as caring for elderly relatives) that fills the gaps caused by weak healthcare provision globally, in which the total net contribution of this work to the global economy is $10 trillion per year. Comparatively, the global automotive industry contributes $4 trillion to the global economy annually. Investing in ‘feminised labour’, and reversing the under-investment in social services such as nursing and childcare allows more women to present in the labour market, earn a decent living and be valued for the work they provide. It also encourages more men to enter this field of work, diversifying the labour market and moving towards gender neutrality in these sectors. Opening up access to typically male dominated fields to women provides a diversity of perspective in innovations in these areas, and provides women with equal access to the same opportunities as men are provided. 

Financing Women
When household income is controlled by women, either through their own earning or cash transfers, a greater proportion is spent on the health, education and well-being of children. At a macro level, financial inclusion for women has a significant impact on the overall economic growth and community development, due to the productivity gains from human capital investment. Despite this, women are disproportionately more likely to be ‘unbanked’ than their male counterparts, with only 65% of women globally having access to a bank account in comparison to 72% of men (with an even larger gap being found in regions such as Southeast Asia and the Middle East). This means that women have less security around their income, are less likely to be able to accumulate savings, and have a reduced access to loans to either fund their household, or start-up their own business. Globally, women are less likely to receive capital investment than men, due to societal assumptions around women’s ability to manage money, and business. By increasing access to finance for women, by the provision of bank accounts and removing social stigmas around lending to women, you don’t just increase the amount of women starting up their own businesses, you also increase the investment going to the next generation, investments in their health, education and well-being. This investment in the future generation leads to significant productivity gains for the country on a macroeconomic level. 

Political Power
Despite women making up over half the global population, we make up less female heads of government than we did five years. Amongst the 193 countries worldwide, only 10 of these countries are headed by a women; New Zealand, Namibia, Bangladesh, Nepal, Estonia, Croatia, Norway, Ethiopia, Taiwan, Lithuania. Interestingly, the rate of women’s representation has increased significantly in the past two decades, rising from 11.8% representation in national parliament in 1998 to 23.5% in 2018. This still does not mean the 30 percent benchmark, often the level of representation required to achieve a ‘critical mass’. Furthermore, a recent UN Women study found that almost 50% of people globally believe that men make better political leaders – a social judgement that places an invisible barrier, and an affront to fairness and a real meritocracy. Globally, we have a real problem with women taking the lead, both in business and in parliament. The full and equitable participation of women in politics is essential to building and sustaining strong, diverse and vibrant democracies. Women’s participation results in huge gains in gender equal policies, greater responsiveness to citizen’s needs (as women tend to be more involved with the local and wider community), and increased investment in the social sectors – sectors that are globally underfunded and undervalued. This provides the global economy with a more sustainable future, ensures we have healthier and happier citizens, and means that women and men are represented equally at all levels of public and private life.

Normalising women in education, in business and in positions of power and decision-making in the public sphere helps reduce these unconscious biases and stigmas that are held in private. Women’s economic empowerment is one of the most essential tools we have to ensure sustainable and inclusive economic development and growth across the world. Investing in the power of women, in every aspect and every step of their life, means a healthier, happier and more equitable society for all.