Promoting women's employment in Latin America and the Caribbean

The world has changed in the last two years. Governments in Latin America and the Caribbean (LAC) face the massive challenge of rebuilding post-pandemic economies. But one thing is certain: Women in the region were hit the hardest during the COVID-19 lockdowns.

A recent report elaborated by the World Bank and UNDP, Uneven Recovery in Latin America and the Caribbean, shows that the gender gap in job participation in LAC continues to be highly elevated. Back in 2020, a previous report using High-Frequency Phone Survey (HFPS) data showed that women in LAC had been 44 % more likely to lose their jobs than men. 

The COVID-19 pandemic continues to suppress women’s employment more than men.

We have analyzed the data and concluded that the labor market shocks have impacted women in at least two ways. First, women who worked before the pandemic were more likely to leave their employment than men. Second, women not employed before the pandemic were less likely to enter employment. As a result, fifteen months into the pandemic, women’s employment in LAC was 15 percentage points below pre-pandemic levels  (Figure 1).

Figure 1. Changes in employment to population ratio from February 2020 to mid-2021

This is not an isolated event. It is happening across virtually all countries in the region. The employment gender gap remained significantly elevated in the Andean countries (31 % during the pandemic vs. 13 % pre-pandemic), Southern Cone (35% vs. 20%), and Mexico (33%  vs. 24 %). Although less elevated in the Caribbean and Central America, the gender employment gap remains prominent.

Figure 2. Gender gaps in employment in February 2020 and mid-2021, per sub-region

Note: The Andean region includes Peru, Colombia, Bolivia, and Ecuador. The Caribbean region includes Antigua and Barbuda, Belize, Haiti, Guyana, St Lucia, Dominica, and Jamaica. The Central American region includes Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica, Panama, and the Dominican Republic. The Southern Cone region includes Argentina, Chile, Paraguay, Uruguay, and Brazil.

How have labor market sectors changed in LAC?

Significant changes developed in the various sectors for women. During the pandemic, the tourism, restaurant, and domestic services industries, which employed many women, had the highest job losses.  This forced women to seek new jobs in informal sectors.

In contrast, employment losses were lowest in sectors employing few women, such as utilities, goods, motor vehicle repair, and construction. Furthermore, some sectors that previously employed a substantial percentage of women have become more male-dominated, including real estate, business, financial, and administrative services.

How have household dynamics shifted? At the start of the pandemic, many women left the labor force to care for children due to school closures. However, this pattern is less clear now. Many women who had left the labor force by mid-2021 had no dependent children. Moreover, women starting new jobs or looking for one often have children under age 18 and minor children under age 5.

Reforms to address gender gaps in LAC

It has been amply demonstrated that gender gaps are a problem that affects not only women, but society as a whole and the development of countries. To address these gaps, it is necessary to address the following points:

1. Revise labor market regulations and improve social insurance systems. Enacting regulations or laws prohibiting gender discrimination in the labor market and strengthening weak social insurance systems can increase access to social services.

2. Use the safety nets providing crucial support to crisis-affected people to address gender gaps. Delivering cash transfers digitally can promote gender financial inclusion, increase women’s savings, improve women’s access to credit, increase their control over funds, and enhance their safety.

3. Invest in affordable, high-quality childcare. Access to affordable childcare services can foster women’s labor market participation and improve early childhood development (ECD) outcomes.

4. Promote examples of “empowered women.” While gender role biases are often deeply embedded, exposure to information about gender biases can contribute to mitigating them.

Women are the central builders of a robust post-COVID world. With the right policies, LAC countries can rebuild stronger and more inclusively, which may determine the course of the next decade. LAC policymakers should spare no effort to address the gender gaps within the region.

The LACGIL works in partnership with units across the World Bank, aid agencies and donors, governments, non-governmental organizations, private sector firms, and academic researchers. This work has been funded in part by the World Bank Group's Umbrella Facility for Gender Equality (UFGE), a multi-donor trust fund administered by the World Bank to advance gender equality and women's empowerment through experimentation and knowledge creation to help governments and the private sector focus policy and programs on scalable solutions with sustainable outcomes. The UFGE is supported by generous contributions from Australia, Canada, Denmark, Finland, Germany, Iceland, Ireland, Latvia, the Netherlands, Norway, Spain, Sweden, Switzerland, United Kingdom, United States, the Bill and Melinda Gates Foundation, and the Wellspring Philanthropic Fund.