Tackling an “Economic No-Brainer”
by Patricia Milton
A new report out by the McKinsey Global Institute offers some staggering statistics about women and the economy. The report’s authors estimate that leveling the playing field for women in the US would add $4.3 trillion, or 19 percent, to U.S. GDP growth in 2025.
The report, released a couple of weeks ago, indicates that we must do better at achieving parity for women in order to achieve better financial outcomes for everyone. A “full-potential” scenario - in which women participate in the economy identically to men - would boost annual gross domestic product globally by as much as $28 trillion in 2025, or 26 percent of global GDP, compared with a business-as-usual scenario.
$28 trillion is about the same as the combined economies of the U.S. and China, and is twice what previous studies have estimated, according to the report’s authors.
“Women’s empowerment is not just a fundamentally moral cause, it is also an absolute economic no-brainer,” according to IMF chief Christine Lagarde, in her keynote speech at the W-20, a conference aimed at boosting gender parity in the global workforce. “It holds the potential to boost growth, raise overall per capita income, tackle poverty, and reduce income inequality for people all over the world,” the IMF chief added.
Gender quality aspects examined in the report range from women’s participation in the labor force, to financial inclusion, to maternal mortality rates, and many more. It looks at these indicators in 95 countries, which account for about 90 percent of the world’s GDP and its population of women.
Narrowing the gender gap even a little bit could add significantly to global economic output. If each country surveyed advanced gender equality by matching the rate of improvement of the best-performing country in their region, it could boost growth by $12 trillion in 2025, the study found.
At Interaction Associates, we have a collaborative change solution for companies interested in developing and advancing their women leaders. Learn more here.
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