How to increase women’s economic participation

As per a recent poll conducted by ILO and Gallup, when women across the globe were asked if they preferred to work in paid jobs, care for their families, or do both, a staggering 70% of women – regardless of their employment status – preferred to work.

Despite this astonishing willingness to work, we see that women’s participation in the workforce has remained stagnant, and even declined in South Asia, over the last three decades, marking a gender gap of 30 percentage points between men and women in the workforce (see Figure 1). Among those who are employed, for every dollar a man makes, a woman makes 77 cents. Closing these gaps can be a central driver of inclusive economic growth. Countries can gain as much as a 20 percent increase in GDP per capita and a 14 percent increase in wealth, on average, if women’s employment was as much as men’s and if women earned as much as men, respectively.

Figure 1. Gender gaps in labor force participation, 1990–2019

Drivers of the gap

There are a multitude of barriers—both on the labor supply-side and demand-side—that constrain women’s participation in the workforce. Supply-side constraints include gender differences in endowments—such as technical and socio-emotional skills, assets, and networks, time constraints due to mounting household and care responsibilities, and limited mobility.

On the labor-demand side, mismatch in skills and education needed for available jobs; gender gaps and discrimination in hiring and retention; and lack of benefits that provide support for childcare, parental leave, re-entry programs, and career advancement circumscribe women’s economic participation. Further, contextual factors such as social and cultural norms and restrictive policies and laws often reinforce the effect of the above barriers and severely constrain women’s ability to enter or re-enter the market. Among women who are able to overcome some such barriers and get employed, many don’t reach their full potential due to wage gaps, under- representation in leadership and gender-based occupational sorting.

Solutions to close the gap

In two new thematic policy notes, “Increasing Female Labor Force Participation” and “Closing Gender Gaps in Earnings,” we critically assess the evidence on tested solutions, highlight operational good practices, and offer a menu of policy options that could work. Based on the strength of the evidence, we classified the assessed interventions into 3 categories:

• Effective indicates that there is more than one causal study demonstrating the effectiveness of the approach across contexts
• Emerging refers to an approach for which there is only one piece of causal evidence or a strong body of descriptive evidence
• Less promising indicates that there is some causal evidence that demonstrates the intervention has limited or negligible impact

Note: For ease of exposition, we have linked one study for each type of intervention. The full list of references can be found in the thematic policy notes. 

Takeaways

Taken together, three key lessons surface from this review.

First, addressing just one constraint is often necessary but not sufficient. Women face a multitude of constraints that often reinforce one another. Effective interventions often need to address more than one barrier. For instance, we find that training and mentorship programs can help bridge the skills gap, address occupational segregation, and improve women’s representation in leadership. However, it is often more difficult for women to access and complete these programs, due to time-poverty, movement restrictions, and gender norms. Thus, programs that integrate gender-smart design aspects —such as providing childcare services and holding training in accessible and safe locations—can boost women’s participation.

Second, legal, and institutional reforms are an important pre-condition to improve women’s labor market outcomes; yet effective implementation through support services, socialization, communication and monitoring are vital to foster change from de jure to de facto. For instance, parental leave mandates need to be complemented with provision of childcare services alongside addressing norms associated with outsourcing childcare.

Third, apart from targeting women, it is equally important to engage their partners, parents and other family and community members. Women, across contexts, do not make decisions alone; their family and community members often enforce gender norms and play a critical role in decision-making. Thus, to truly empower women, it is pertinent to design interventions that target various stakeholders in women’s circles so as to positively impact attitudes and norms around women’s work.