Why gender parity
The high cost of gender inequality has been documented extensively. But a new study by the McKinsey Global Institute estimates that it is even higher than previously thought – with far-reaching consequences.
The McKinsey study used 15 indicators – including common measurements of economic equality, like wages and labor-force participation rates, as well as metrics for social, political, and legal equality – to assign “gender parity scores” to 95 countries, accounting for 97% of global GDP and 93% of the world’s women. Countries also received scores for individual indicators.
Unsurprisingly, high scores on social indicators correspond with high scores on economic indicators. Moreover, higher gender-parity scores strongly correlate with higher levels of development, as measured by GDP per capita and the degree of urbanisation. The most developed regions of Europe and North America are closest to gender parity, while the still-developing region of South Asia has the furthest to go. Within regions, however, there are significant disparities, owing partly to differences in political representation and policy priorities.
One overarching conclusion of the McKinsey study is that, despite progress in many parts of the world, gender inequality remains significant and multi-dimensional. Forty of the countries studied still exhibit high or very high levels of gender inequality in most aspects of work – especially labor-force participation rates, wages, leadership positions, and unpaid care work – as well as in legal protections, political representation, and violence against women.
The costs of this inequality are substantial. If women matched men in terms of work – not only participating in the labour force at the same rate, but also working as many hours and in the same sectors – global GDP could increase by an estimated $28 trln, or 26%, by 2025. That is like adding another United States and China to the world economy. Closing the gender gap in labour-force participation would deliver 54% of those gains; aligning rates of part-time work would provide another 23%; and shifting women into higher- productivity sectors to match the employment pattern men would account for the rest.
Given recent rates of progress, it is unrealistic to expect full gender parity in the world of work in the foreseeable future. But countries could match gains in the bestperforming economy in their region. That would add up to $12 trln to global GDP by 2025, boosting GDP by 16% in India and about 10% in North America and Europe.
To achieve this, the McKinsey study recommends that governments, non-profits, and businesses emphasise progress in four key areas: education, legal rights, access to financial and digital services, and unpaid care work. As these critical and mutually reinforcing efforts boosted women’s economic standing, they would naturally help to improve women’s social position, reflected in better health outcomes, increased physical security, and greater political representation.
The first step is improved education and skills training, which have been proven to raise female labour-force participation. Smaller differences in educational attainment between men and women are strongly correlated with higher status for girls and women, which helps to reduce the incidence of sex-selective abortions, child marriage, and