Gender parity and human capital

The development and deployment of human capital is a critical element of economic growth and social inclusion in all countries. Two of the Global Gender Gap Index’s four subindexes—Educational Attainment and Economic Participation and Opportunity—relate to the development and deployment of female human capital in particular. The World Economic Forum’s Human Capital Index measures a country’s “distance to an ideal” on learning and employment outcomes, for women and men. In Figure 9 we plot the Human Capital Index against a composite measure of educational attainment and economic participation and opportunity from the Global Gender Gap Index. The results show how countries have and have not prioritized gender equality in their quest for optimizing human capital. In the top right are economies that have both high human capital and low gender gaps, indicating an even spread of opportunities. In the top left are countries that have high human capital and large gender gaps. There are few countries in this space—countries cannot have very high human capital if their gender gaps are large because women are one half of the population. In the bottom right are countries where the human capital is low but the gender gaps are small, indicating an even spread of opportunities, even if those opportunities are limited overall. In the bottom left are countries where human capital optimization is low but gender gaps are wide, indicating uneven human capital development across gender lines.

This section of the Report takes a deeper look at key outcomes and contextual factors globally within educational attainment for women and men. It also looks at the key outcomes and contextual factors within economic participation of women and men, examining both paid and unpaid work, and the impact of care and demographics.

Educational Attainment

Despite some regional variation, globally today, young women and men entering the labour force have almost identical levels of educational qualifications. There is near parity in primary and secondary education, with remaining gender gaps of 2% and 3%, respectively, and a 7% gap when it comes to participation in tertiary education. Seen another way, in 62 countries primary education gaps have been closed, in 90 countries secondary education gaps have been closed, and in 95 countries tertiary education gaps have been closed. However, women make up a marginally larger proportion of out-of-school children and a much larger proportion of youth not in school or education (23% compared to 15%).

Among women and men over age 25 and already in the workforce, the educational gender gap with regard to level of qualifications held is larger. Global gender gaps in primary, secondary and tertiary educational attainment stand at 11%, 17% and 14% respectively, in the age 25+ cohort. However, these gaps have narrowed significantly in current educational enrolment, which will be reflected in the composition of the future workforce. For example, since the rate of enrolment in tertiary education of young women currently surpasses that of young men, each year, an extra 4 million young women graduates are beginning to reverse the tertiary education gap of the previous generation at the global level.

As highlighted by our measure of skill diversity, featured in the Report’s Country Profiles, women graduating from tertiary education courses have acquired a similar range of skills and academic subject knowledge to their male colleagues. However, one area in which women continue to remain under-represented is among STEM graduates, for which the global gender gap stands at 47%, with 30% of all male students graduating from STEM subjects, in contrast to 16% of all female students. That gap is commonly attributed to negative stereotypes and lack of role models, lowering girls’ performance and aspirations vis-à-vis science and technology.²⁵ It represents a key emerging issue for gender parity, since STEM careers are projected to be some of the most sought-after in the context of the Fourth Industrial Revolution.

With every yearly edition, the Report has recorded an increasing number of economies reaching parity in educational enrolment, reflecting major investments in educational gender parity paying off in most parts of the world. Since 2006, countries such as Latvia, Botswana, Nicaragua, Slovak Republic, Costa Rica, Canada, United States and Iceland have fully closed their Educational Attainment gender gaps. However, of the 144 countries in this year’s Index, 17 have remaining education gender gaps wider than 10% and eight record gaps wider than 20%. The list of countries underperforming on this subindex is dominated by those from lower-income groups, indicating specific barriers to evenly educating their populations. Still, some low-income countries outperform their more affluent peers. Notably, Nepal, Zimbabwe and Rwanda have closed more than 90% of their education gender gaps, with Nepal closing a significant 18% in the past 11 years.

Most of the 107 countries covered since the inception of the Report have made strong progress on education. India, Pakistan, Ethiopia and Saudi Arabia are among those countries showing strong gains in the 11 years since 2006, with varying starting points. Some of the lowest-ranked countries on this dimension, such as Yemen and Chad, have similarly closed their education gender gaps by 16% and 15%, respectively, over this period, although they continue to lag behind due to their low starting point. In the case of Chad, the country had closed 47% of its education gender gap in 2006 but has now closed almost 60%. The outliers are countries such as Nigeria and Angola which continue to have relatively wide education gender gaps, and have hardly improved for more than a decade.

North America has completely closed its education gender gap. If all things remain equal, Latin America and the Caribbean as well as South Asia are expected to close their education gender gaps in the next five years. Ten years from now, the Middle East and North Africa region should see its education gender gap narrow to a close. East Asia and the Pacific and Sub-Saharan Africa will close their education gender gaps in 21 and 33 years respectively, while Eastern Europe and Central Asia boast a much slower rate of change, projecting the time of education parity to be 87 years. The real concern remains Western Europe, which despite its high performance has seen decline rather than improvement over the past 11 years.

Economic Participation and Opportunity

Globally, 54% of working-age women take part in the in the formal economy, on average, as compared to 81% of men. Women make up a larger proportion of discouraged job seekers and of those outside the labour force; and, on average, women’s unemployment rate is nearly 2% higher globally. Women work three times as often as men as contributing family workers in family enterprises, and are almost twice more likely to work part-time.

Education gains have not always translated into economic gains for women. Even though there is near gender parity in employment for professional and technical workers, reflecting in part the equal education and skills levels among women and men with tertiary education, women hold less than a third of senior roles.

Existing data benchmarking women’s economic leadership roles is uneven in coverage and more should be done to fill existing gaps in knowledge.²⁶ Based on what is currently known, average female representation on boards is 14%, and only in five countries have women broken the 30% participation threshold: Iceland, Norway, France, Latvia and Finland. In addition, only 16 countries have a firm ecosystem in which more than 50% of firms have any female participation in firm ownership. Notable performers include the Philippines, China, Nicaragua, Bahamas, Botswana, Sweden and Brazil.

There also continues to be a persistent wage gap in paid work. Women’s average earnings are almost half those of men, with average global earned income for women and men estimated at $10,778 and $19,873, respectively. Countries that perform well in this dimension of gender parity span all regional and income groups. Slovenia, Norway and Sweden are some of the most gender-equal economies among high-income countries. Botswana and Thailand exhibit the highest income parity among upper-middle income countries. Vietnam, Lao PDR and Ghana have narrowed their income gender gaps the most among the lower-middle income country group. Mozambique, Tanzania and Rwanda lead among the low-income countries, having closed over 80% of their estimated earned income gender gaps. On the other end of the scale, countries such as Bahrain, United Arab Emirates, Saudi Arabia and Korea, Rep. have high national income, but income gaps of over 50%.

When it comes to executives’ perceptions of wage equality for similar work, no country has reached parity. In only five countries, the remaining gap is less than 20% while in 88 countries the gap is between 20% and 40%. In 35 countries the gap is between 40% and 50% while in five countries—France, Chile, Peru, Hungary and Brazil—executives see the remaining wage gap for similar work to be above 50%.

Exacerbating economic gender gaps is the degree to which women remain at a disadvantage in the ability to accumulate, inherit and manage wealth. Around 1% of countries retain completely restrictive legislation on using financial services, and an additional 35% have somewhat restrictive legislation in place to regulate women’s access to financial services. A similar proportion has somewhat restrictive legal systems when it comes to the ability to inherit assets; however, the number of countries with highly restricted rights of inheritance is much higher, at 18%. Finally, with regard to women’s access to land and non-land assets, 58% and 45% of countries, respectively, have full gender parity in the eyes of the law, while 40% and 53% have achieved partial gender parity. The unequal access to assets is reflected in the gap between women and men holding a bank account—56% compared to 63%, respectively.

Applying the rate of change of the 107 countries covered by the Index since 2006, there is a mixed picture in countries’ ability to deploy their female human capital. On average, the economic gender gap has been closed by 2% over the past 11 eleven years, at an uneven rate of progress, and, at 42% distance from parity globally, it continues to stand at a much lower point than the education gender gap. A number of economies have shown strong improvement; among them, Cameroon, Benin, Guatemala, Nicaragua and Saudi Arabia. No country has yet reached parity on the Economic Participation and Opportunity subindex. Mirroring gains on the Educational Attainment subindex, to date 68 countries out of the 144 covered by the Index this year have achieved gender parity in skilled roles, i.e., women and men employed as professional and technical workers. A number of countries have also achieved the more elusive goal of reaching gender parity in senior roles, namely Barbados, Columbia, Jamaica and the Philippines.

With the current rates of change across world regions, the closing of the economic gender gap ranges from only 47 to 1951 years. The fastest-closing economic gap is in Western Europe, taking 47 years, closely followed by Sub-Saharan Africa and Latin America and the Caribbean, which both can expect an approximate 60-year wait for economic gender parity. Slower rates of change are predicted for Eastern Europe and Central Asia at 93 years, as well as East Asia and the Pacific at 111 years. The economic gender gap rates of change that are most concerning remain those in the Middle East and North Africa as well as South Asia, with predictions of 356 and 1951 years, respectively. The lowest-performing region is now North America, where the economic gender gap has increased by 1% since 2006.

Unpaid Work and Care

In many societies, even as women have entered the labour force, they have also retained primary responsibility for unpaid work such as caregiving and household chores. Gender gaps in paid work thus reflect gender gaps in unpaid work, at least in part. This relationship is clearly visible in Figure 10, which plots the gender gap in unpaid work against the Economic Participation and Opportunity subindex, reflecting the gender gaps in paid work.

On average men do 34% of the unpaid work that women do.²⁷ Research shows that this imbalance starts early, with girls spending 30% more of their time on unpaid work than boys.²⁸ Figure 11 shows the imbalance between paid and unpaid work for both women and men for the thirty countries for which this data is available.

However, the sum total of the time spent by women on work—both paid and unpaid—is higher than for men. Women work on average 50 minutes more a day than men across both paid and unpaid work. Figure 12 shows the minutes spent on paid and unpaid work, for both women and men, revealing the strong gender gaps in distribution and the longer time spent by women on all forms of work, across most economies.

Unpaid work conducted by women varies across countries. The largest proportions of unpaid work are routine housework and caregiving, both childcare and care for older people.²⁹ Housework can look different across different economies, often driven by income levels and access to basic infrastructure. Similarly, specific elements of childcare can vary by geography, ranging from physical care, teaching, reading and playing. Demographics as well as income and societal expectations therefore play a strong role in the division of labour between women and men when it comes to paid and unpaid work. See Appendix E for further information on demographics.

Preparing for the Future

Based on the results of this year’s Index, it is evident that, globally, progress on achieving gender parity in education has been comparatively high, while economic gender parity remains elusive: a remaining gender gap of about 5% compared to a remaining gender gap of 41%, respectively. In addition, progress on the economic gender gap has fluctuated more dramatically. As we see cohort after cohort of highly educated women enter the workforce, if economies are to fully utilize their talent, there needs to be a corresponding narrowing of the economic gender gap to benefit from women’s strong performance on educational qualifications. As highlighted by the Report’s data and an increasing number of studies, disparities in skills and qualifications alone cannot solely account for these differential economic outcomes for women and men.

While many countries are ideally poised to maximize opportunities for women’s participation in the labour market, a large proportion have failed to reap the returns on a pool of highly educated and skilled women. Figure 13 plots the Educational Attainment subindex against the Economic Participation and Opportunity subindex. The data reveals four broad groups of countries: (1) countries that have closed or are generally on track to close education gender gaps and show high levels of women’s economic participation; (2) countries that have closed or are generally closing education gender gaps but show low levels of women’s economic participation; (3) countries that have large education gaps as well as large gaps in women’s economic participation; and (4) countries that have large education gaps but display small gaps in women’s economic participation.

In the first broad group are countries that have made investments in women’s education and generally see the returns on this investment in the form of women’s economic and political participation. These countries include the Nordic countries, the United States, but also high-performing lower-income countries such as Botswana and Rwanda.

In the second broad group are countries that have made key investments in women’s education but have generally not removed barriers to women’s participation in the workforce and are thus not seeing returns on their investments in terms of development of one half of their nation’s human capital. This group includes Iran, Islamic Rep., the United Arab Emirates, Chile and India. These countries have an educated but untapped talent pool and would have much to gain from women’s greater participation in the workforce.

In the third and fourth groups, the most basic investments in girls’ and women’s education still need to be made, and fundamental rights—including legal frameworks around inheritance, reproductive rights and violence—are often inadequate. The third group contains countries such as Yemen and Pakistan that have large education as well as economic gender gaps. The fourth group contains countries such as Chad and Nigeria, which have large education gender gaps but small economic ones, primarily due to high levels of participation by women in low-skilled work. Compared with the third group, women in these countries have greater access to income and decision-making.

As countries seek to prepare their human capital for the Fourth Industrial Revolution, ensuring that women and men receive equal access to education and work opportunities will be a critical element in safeguarding growth and inclusion. Governments have a range of policy options relating to education, employment and care available to them.

For countries where education gaps still persist, investment in girls and women’s education will be critical for human capital development. A substantial body of literature has shown that investing in girls’ education is one of the highest-return investments a developing economy can make—and, for these countries, closing education gender gaps will remain an important factor over time. The provision of universal education is critical to increase opportunities for the wider population to participate in the skilled labour market. In countries where public education is not available, low-income families may favour the education of sons over daughters if they have limited resources and must weigh up opportunity costs to paying for their children’s education.

Gender bias in education systems is also a factor in women’s workforce participation. Where direction towards particular subject choices is gendered, and role models and learning materials reinforce gender stereotypes, girls’ educational achievements and possibilities beyond education are limited. Gendered subject choices in education and training are reflected in labour markets with traditionally ‘male’ and ‘female’ jobs. This gap may have an even stronger impact on income inequality in the future, necessitating action by governments today. For example, many forecasts, including our own, predict that future job growth will lie in job families that currently employ few women, such as computer and mathematical roles as well as architecture and engineering.³⁰ This requires deeper investment in closing the STEM education gender gap to prevent future workforce gender gaps.

Deploying women’s human capital will also require strategic focus from countries. Access to financial services and digital access are critical elements for enhancing women’s labour force participation across all economies. For countries that have already made investments in education, it will be important to track the progress of these skilled cohorts of women and ensure that they are able to leverage their skills in the workforce through a range of fiscal and social policy instruments. For example, reducing the tax burden for secondary earners by replacing family taxation with individual taxation, improves women’s participation in the labour force.³¹ Legislative structures can help prevent gender-biased discrimination in the workplace. Obligatory and voluntary quotas in public and private entities, targeted subsidies to female businesses, and supervisory bodies monitoring the implementation of national policies are also approaches used successfully around the world. Public-private cooperation to close economic participation gaps presents a promising approach. See Appendix G for further details on the Gender Parity Task Force model developed by the World Economic Forum.

One of the most critical pressure points often relates to the care infrastructure, due to the greater portion of unpaid work performed by women. Stronger care-related policies could therefore enhance women’s economic participation and re-balance care roles in the home. See the Box on Care Policies (page 34) for more information on global care policy approaches.

Finally, preparing for the future may also require a deliberate approach to managing upcoming workforce disruptions that may impact women and men differently. For example, our Future of Jobs Report predicted that the disruptions of the Fourth Industrial Revolution will lead to decline in some of the currently most gender equal job families—art, design, entertainment, media, and office and administrative functions. Strategic focus will therefore be needed, by both governments and businesses, to help avoid a deepening of gender divides through re-skilling and up-skilling that takes gender gaps into account.

Notes

25  See Hill, et al., Why So Few? Women in Science, Technology, Engineering, and Mathematics.

26  See, for example: UNCTAD, Global Assessment of Sex-Disaggregated ICT Employment Statistics: Data Availability and Challenges on Measurement and Compilation.

27  Unpaid work performed by men has been modelled as a proportion of women’s unpaid work utilizing data from the Global Gender Gap Index: 37% is the modelled global number, compared to the original number of 34% reported for OECD countries.

28  See UNICEF, Harnessing the Power of Data for Girls: Taking Stock and Looking Ahead to 2030.

29  See OECD, Cooking and Caring, Building and Repairing.

30  See World Economic Forum, The Future of Jobs: Employment, Skills and Workforce Strategy for the Fourth Industrial Revolution.

31  See International Monetary Fund, Women, Work, and the Economy: Macroeconomic Gains from Gender Equity.