Closing the yawning gap between employment levels for men and women in southeast Asia could add as much as $2.2tr to the region’s economy, according to analysis by economists at the World Bank for GlobalMarkets.
Although the region is forecast to post strong economic growth both this year and next — and faster than the Bank predicted just six months ago — its economies are failing to access the untapped potential offered by increasing female employment.
The bank’s regional forecast shows GDP growing by 6.4% this year and slowing only slightly to 6.2% in 2025, faster than any other region in the world, and an upgrade from its April forecasts of 6%-6.1% for those two years.
But Franziska Ohnsorge, the Bank’s chief economist for south Asia, said even that blistering pace of growth fell short of what the region’s economies could achieve if they unlocked the “untapped potential” offered by higher female employment and greater openness.
Only 32% of working-age women were in the labour force last year, well below the male participation rate of 77% and an average for women across emerging markets and developing economists of 54%.
Modelling done by her team showed that if the share of female labour force participation were as high as the male equivalent, regional output could be anywhere between 13% and 51% higher. In calculations carried out for GlobalMarkets, Ohnsorge said closing the gap would translate into an aggregate increase in GDP of between $581bn and $2.3tr, or $300 to $1,177 per capita.
Women often face barriers to entering the workforce from legal restrictions and social norms. Ohnsorge cited research showing south Asian countries had among the most conservative gender attitudes in the world, with 70% of the population expressing beliefs that were opposed to women working outside the home.
Despite a dramatic narrowing of gender gaps in educational attainment across south Asia, women’s ability to supply their labour was constrained by factors as such a lack of safe transport, childcare and legal protections for female workers.
Earlier this year research by Oxford Economics for Uber on ride-hailing in southeast Asia found risks of sexual harassment on public transport directly affected women’s physical mobility, limiting their opportunities to work and even deterring them altogether. It calculated greater access to phone-based ride-booking could bring almost 1 million women into the workforce in seven major cities in India, Sri Lanka and Bangladesh, which would deliver a boost to their economies of more than 1%.
Bali Kaur Sodhi, the author of the research, told GlobalMarkets: “Efforts to close these gender gaps can bring substantial benefits to the individual, their households and the wider economy.”
But Ohnsorge said supply side interventions were not going to be enough, pointing to the need for a big demand side boost to employment generation. “What is the prescription for employment? One of the most obvious ones is faster growth in export-oriented industries,” she said, adding that female workforce participation tended to be higher in south Asian labour markets with greater exposure to exports.