Closing Gender Gaps Would Trigger Strong GDP Growth in Southern Cone – IDB report

If all workplace barriers women face were removed, Southern Cone countries’ GDP could rise by as much as 4 percent to 15 percent, a new report by the Inter-American Development Bank says.

In Brazil, if ethnic barriers were also eliminated, GDP could gain as much as 30%, according to the report Closing the Southern Cone Gender Gaps – an Untapped Potential for Growth, which was issued during an international webinar on the subject.

The study provides evidence on the economic consequences of gender inequalities, their causes, and the policies that may help mitigate them in Southern Cone nations Argentina, Brazil, Chile, Paraguay, and Uruguay.

Southern Cone countries’ women employment rate is 49% on average, or 21 percentage points less than that of men. In the 1990s, Chile posted the lowest female employment rate – below 35% --, but it shot up dramatically in the early 2000s, and by 2019 it reached nearly 48%. Paraguay has had the region’s highest women employment rate throughout the whole period, reaching about 55% in 2019.

The book also provides empirical evidence of some of the necessary ingredients to close the existing gender gaps. These include promoting women’s educational and professional development, supporting their access to technological careers, and endorsing gender-sensitive public policies that take women’s perspectives, aspirations, and challenges into account.

The report also concludes that investments to promote women’s human capital can have a multiplying effect on gender equality. For example, encouraging girls to become best students has a positive effect no just on themselves, but also on their future female schoolmates.

But it also warns that while there is a need to motivate more women to pick technology and engineering career paths, which can lead to some of the best paid jobs, it is equally paramount to eliminate cultural barriers and social norms that make it hard for women to succeed in male-dominated fields. For example, data from Chile shows that women picking technology careers could be subject to more workplace discrimination than women in other fields.

Lastly, it is also critical to promote gender-sensitive urban policies to incentivize women’s participation in the labor market so they can gain economic autonomy. Women commute more than men, travel more often outside peak hours, walk more and use public transportation more, and devote a large share of their travel time to family care considerations. For example, the report found that women in Buenos Aires have less access to jobs than men because they have to commute longer distances and spend more money on commuting.

Women also place greater value than men on social benefits and on social security for their families, making it even more crucial to adopt policies to formalize micro and small sized enterprises in order to narrow the marketplace gender gaps.

Please download the full report or the executive summary here.