Women in the Economy
Global Growth Generators
The relevance of gender to economic growth as a mainstream research question is a relatively new field. There is an impressive and growing body of literature on women and the economy most notably from global institutions such as the IMF, the OECD, the United Nations and the World Bank. This year the G20 has also included women as a driver of growth as part of its overall progress agenda. Despite this, most of the work produced by leading economists on global growth and, in particular, on whether we face a future of secular stagnation, still concentrates on monetary and fiscal policy responses.
This report in our Citi GPS series is a statement that we at Citi believe that the role of women in the global labor force should be incorporated as a mainstream topic within the debate on global growth for both economic as well as social reasons. We shall be building on this report by developing a deeper research work stream on gender economics.
In this report, our global economics team has partnered with Heidi Crebo-Rediker to analyze the dynamics of global female labor force participation. We are delighted to work with Heidi who has enjoyed a distinguished career in both business and government, including as Chief Economist at the State Department under Hillary Clinton where she worked and lectured on the topic of female labor force participation. Average female labor force participation has flat-lined over the past 20 years.
In this report, our economists revisit the “Global Growth Generators” thesis that we outlined when we launched our Citi GPS series in 2011 and argue that fresh policy responses, as well as learning from best practice, could improve female labor force participation with significant benefits that are not just economic but also social as well. Looked at purely through an economic lens, greater female labor force participation would drive productivity, reduce the economic drag of adverse demographics and substantially improve the skill mix of the global economy.
Of course, our authors point out that much work currently done in the informal economy cannot be ignored and does not get adequately captured in conventional economic measurements. Moreover, there are many cultural and societal issues that lie behind the gender composition of the global labor force, especially in developing economies. These issues also need to be analyzed and understood.
In advanced economies, education gaps have largely been closed but other barriers still remain, some in legislation, that impact the gender balance of the workforce. We observe significant progress in countries such as Canada, the Netherlands and Sweden which may offer models that can be leveraged more widely. In Japan, Prime Minister Abe is embracing “Womenomics” as a core pillar of his reform strategy.
In developing economies, there is a markedly widespread variance in female economic participation with many social and cultural factors impacting gender equality. The potential for policies and practices – and therefore for economic opportunities for women to improve – is likely highest, on average, in the developing markets. The unlocking of women’s potential in the global economy may well prove to be the key factor that tips the balance from a future of weak growth to one of sustained, inclusive and improving growth over time.
I would like to thank our authors for their impactful contribution to this critical global debate and we look forward to developing further research in this area as well as to contributing to the public policy debate on gender economics.