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What would the world be like if women worked and earned the same as men? US economics professor Joyce Jacobsen has attempted to calculate the economic cost of gender equality as part of a new book entitled How much have global problems cost the world?
She calculates a conservative estimate of around 7% of GDP was lost to the global economy in 2010 as a result of women’s lower participation in work. This takes into account the fact that women’s lack of participation in the workforce may in part be due to personal choice, the increased cost of female education and training and the loss of women’s unpaid role in the home.
Jacobsen bases her calculation on women constituting 40% of the workforce in 2010 and earning only 60% of men’s wages.
She projects that in 2050 gender inequality will still account for a 4% loss to the world economy or between $6.4-9.7 trillion.
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Using a historical analysis, Jacobsen suggests that women comprised 15% of the global workforce in 1900, rising to 25% in 1950 and 40% in 2010. She suggests the earnings ratios of women to em were 50%, 45% and 60% respectively.
She projects that in 2030 women will constitute 42% of the workforce and 45% in 2050, with the earnings gap standing at 65% and 70% respectively.
She says: “The loss to the world economy currently is still twice the size of the entire global GDP in 1900, at $3.9 trillion. Projecting this forward to 2050, the 4% loss to the world economy would total between $6.4 trillion [assuming 2.5% annual growth) and $9.7 trillion (at a 3.5% growth rate).”
Gender pay gap
Jacobsen’s analysis comes at a time when the most progressive companies are looking to increase their retention of female staff and at a time of growing focus on the gender pay gap.
Last week, for instance, deputy prime minister Nick Clegg lent his support to a campaign which calls on women to ask their main colleagues what they earn.
Clegg told Elle magazine which is part of the Make Them Pay campaign: "Women should feel free to ask male colleagues how much they earn in the same jobs and I'm sure most men would want to help. This is a simple step which could have a big impact. But the gender pay gap is a stubborn problem."
He also called on men to share more of the childcare responsibilities so women's careers did not suffer. Swinson said progress had been made on reducing the gender pay gap, but said it was not moving fast enough and that legislation to make equal pay audits compulsory might be necessary.
Currently gender pay audits only apply to corporates and larger SMEs who are found guilty of sex discrimination over pay by an employment tribunal.
A recent report by the Chartered Institute of Management and salary specialists XpertHR also found that male managers earned average bonuses twice as big as those of their female counterparts over the last 12 months which it said was contributing to the gender pay gap.
In addition, a report on women and work by the Office for National Statistics showed that, although more women are now working and a larger number are managers, men still are more likely to be employed in higher skilled and higher paid jobs than women.
*How much have global problems cost the world? is edited by Bjorn Lomborg and published by Cambridge University Press, price £22.99.