By Sunny Lewis
WASHINGTON, DC, June 1, 2018 (Maximpact.com News) – Globally, countries are losing $160 trillion in wealth because of differences in lifetime earnings between women and men. This amounts to an average of $23,620 for each person in the 141 countries studied by the World Bank Group for a new report released this week.
“The world is essentially leaving $160 trillion on the table when we neglect inequality in earnings over the lifetime between men and women,” said World Bank CEO Kristalina Georgieva.
“This is a stark reminder that world leaders need to act now and act decisively to invest in policies that promote more and better jobs for women and equal pay at work,” she said.
The study, “Unrealized Potential: The High Cost of Gender Inequality in Earnings,” examines the economic cost of gender inequality in lost human capital.
Its release precedes this year’s meeting of the G7, currently headed by Canada, which has committed to ensuring that gender equality and women’s empowerment are integrated across all G7 activities during its presidency.
This informal group of seven advanced economies consists of: Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States. The European Union also attends.
As G7 president, Canada will host the G7 Summit June 8-9 at the Fairmont Le Manoir Richelieu in the Charlevoix region of Quebec.
Advancing gender equality and women’s empowerment is one of the five themes that will occupy G7 leaders this year, says Canada’s Prime Minister Justin Trudeau.
“The themes we have chosen for the year will help focus our discussions on finding real, concrete solutions to promote gender equality, women’s empowerment, clean energy, and economic growth that works for everyone,” said Trudeau.
On January 23, Trudeau announced the creation of the Gender Equality Advisory Council , which will ensure that gender equality and women’s empowerment are integrated across all themes, activities and initiatives of Canada’s G7 Presidency. The Council is co-chaired by Melinda Gates and Isabelle Hudon.
The Prime Minister said, “Women’s empowerment is a key driver of economic growth that works for everyone. All of us benefit when women can participate freely, fully, and equally in our economies and society, and supporting and empowering women and girls must be at the heart of the decisions we make.”
“That is why we made gender equality and women’s empowerment a central theme of Canada’s G7 Presidency – and created the Gender Equality Advisory Council for Canada’s G7 Presidency,” Trudeau said. “Thanks to the Council, we will make sure a focus on gender equality guides the work done at the G7 Leaders’ Summit – and set a precedent for the G7 going forward.”
For the first time, the G7 engagement process included a summit of diverse feminist leaders, the W7 . In April, over 60 feminist leaders from Canada, G7 countries and around the world met in Ottawa with Trudeau and Canada’s Minister for the Status of Women.
The W7 called for a more just and equitable economy that moves away from exploitation and extractivism. Too many women around the world are facing precarious, dangerous and exploitative work situations, and the current economic model is fueling conflict and violence against women, they said.
“The greatest threats my community in Guatemala faces today are caused by extractive industries from G7 countries; and most of them are actually Canadian,” said Irma Alicia Velasquez Nimatuj, an indigenous Guatemalan journalist and anthropologist, in speaking to Prime Minister Trudeau.
In nearly every country today, women face barriers to full participation in the work force and earning as much as men. As a result, women account for only 38 percent of their country’s human capital wealth, defined as the value of the future earnings of their adult citizens – as compared with 62 percent for men, according to the World Bank report.
In low income and lower-middle income countries, women account for just a third or less of human capital wealth.
Programs and policies that make it easier for women to get to work, access basic infrastructure and financial services, and control land could help achieve gender equality in earnings, the World Bank report suggests.
“Human capital wealth accounts for two-thirds of the global changing wealth of nations, well ahead of natural and other forms of capital,” said the report’s author Quentin Wodon, World Bank Group lead economist. “Because women earn less than men, human capital wealth worldwide is about 20 percent lower than it could be.”
The losses in wealth from inequality in earnings between men and women vary by region. The largest losses – each between $40 trillion and $50 trillion – are observed in East Asia and the Pacific, North America, and Europe and Central Asia.
This is because these regions account for most of the world’s human capital wealth, but losses in other regions are also substantial.
In South Asia, losses from gender inequality are estimated at $9.1 trillion, while they are estimated at $6.7 trillion in Latin America and the Caribbean and $3.1 trillion in the Middle East and North Africa.
In Sub-Saharan Africa, the losses are estimated at $2.5 trillion. While losses in low income countries are smaller in absolute terms than in other regions, as a share of the initial endowment in human capital, the losses are larger than for the world.
The study is part of a broader research program at the World Bank that benefits from support from Government of Canada, the Children’s Investment Fund Foundation, and the Global Partnership for Education.
“There are estimates showing the costs and benefits of gender equality to key economic sectors and economic growth,” said World Bank Group Senior Director for Gender Caren Grown.
“By focusing on wealth,” said Grown, “this study is a unique addition to that literature since wealth, and especially human capital, is the assets base that enables countries to generate future income.”
Featured Image: This textile factory in Shtip, Former Yugoslav Republic of Macedonia, employs about 120 women, who make garments for Italian and German brands. There is still no minimum wage in the FYRM textile industry. December 7, 2016 (Photo by Rena Effendi / UN Women Europe and Central Asia) Creative Commons license via Flickr