A new report from PricewaterhouseCoopers says that if the world’s biggest economies bench-marked their workforces to Sweden, which has a 69% female employment rate, the total global GDP gain could be as much as $6 trillion.
The Women in Work Index 2019, released today (March 5), uses a number of measures to gauge workplace equality, including countries’ employment rate—that is, the number of people employed as a share of the working age (15-69) population. Its authors suggest that if countries in the Organization for Economic Co-operation and Development (OECD) caught up to Sweden’s female employment rate, they would see huge financial gains.
Sweden is actually second on the index in terms of all the measures—Iceland is first, but its small population size makes it less possible to extrapolate to other populations.
In absolute terms, the US would make the biggest gains from getting more working-age women employed, with a GDP increase of $1.8 trillion, the report says. That’s almost three times as much as Italy, the next in line for improvement, which like Greece and Mexico has a relatively low female employment rates. The employment rate for women in the US is 68%, but other measures on the index—a weighted average of several indicators including pay equality and women’s access to employment—mean it scores low overall.
While the US has made some improvements in policies related to increasing women’s ability to work in recent years, it’ has also been outstripped by the rest of the world’s rich countries. Consequently, it has slipped down the international rankings of total female economic empowerment since the PwC index was first created, from number 9 out of 33 in 2000, to number 23 today.
Iceland, Sweden, Norway, and other Scandinavian countries consistently score high on indices of the number of working women, in part by mandating support for women who become mothers. The US, by comparison, is the only developed economy to mandate no support for women who have children and continue their careers.
On average across OECD countries, men participate in the labor force at a rate 11% higher than women, PwC noted, a gap that has narrowed from 17% in 2000. (Labor force participation differs from employment because it takes into account people who are of working age and seeking employment, but not currently employed.)
The report’s authors also noted that China and India, while not members of the OECD, would have a massive impact on the global economy were they to move closer to workplace equality. China, in fact, has one of the highest female employment rates in the world—66%—but it has a large pay gap of 25%.
India, meanwhile, would have placed last on the index had it been included. “India struggles with low levels of female participation in the workforce due in part to prevailing cultural norms about the role of women in society,” the authors wrote. It has both a gender pay gap of a massive 39%, and low female employment rates. If the female employment in India was increased to the same level as Sweden, the authors wrote, that country alone could see a $7 trillion boost to GDP, or about 79% of India’s GDP.