Stephanie Kelly

The research paper, ‘A Women’s Place; Boosting female labour-force participation to lift long-term economic growth’, provides important guidance on what governments should focus on to help support the issue of gender inequality in the workplace and support long-term economic growth.

The diversity and inclusion debate usually centres on the importance of social justice in the workplace and society. But there’s a powerful efficiency argument too. Increasing diversity and inclusivity in the workforce can lift incomes and growth.

As well as boosting utilisation rates, it can improve productivity by making better use of human capital. By understanding the policy and other constraints that limit women’s full participation in the workforce, governments will be better able to address long-term growth challenges and investors will be better able to assess the diversity and growth outlook.

ASI’s research institute has analysed data for 31 countries from 2002 to 2016. Our findings suggest five clear actions for policymakers and companies wanting to lift female participation.

The report has called for men to have access to paternity leave so that the burden of child-related career breaks is more evenly shared. We introduced our shared parental leave policy in January last year, but we realise more needs to be done to incentivise men to take that leave.

It has also called for reform taxation systems to reduce tax wedges for second earners and sole parents given the clear negative impact it has on female participation. The prevalence of these distortions only reinforces the unfair care/work trade-off that women face.

The report has said businesses must consider both the quantity and quality of female work. Given the reality of the care/work trade-off, part-time work and flexible short-term employment regimes are important for providing women with opportunities to retain their connection to the workforce.

It has also called for the government to strengthen the performance and resilience of the overall economy, both in terms of potential growth and reduced cyclicality of that growth can strengthen labour markets to facilitate greater overall participation. The two largest drivers of female participation were education, which is linked to economic development, and male participation.

The research institute has also called for increased reporting of higher quality data so that the government can monitor what companies are doing and understand what really works in terms of improving Diversity & Inclusion within firms and how that relates to corporate performance. Investors have a role to play in encouraging firms to release this information.

Stephanie Kelly, senior political economist at ASI, said: “The disproportionate hardship inflicted on women by Covid demands urgent action from governments and companies to address gender inequality at work. Lockdowns have hit hardest at low-paid service-sector jobs typically filled by women.

“Women are bearing the brunt of home-schooling, childcare and housework, even if they’re working themselves. Furthermore, women are far more likely than men to face a trade-off between paid work and unpaid work, including caring responsibilities. Consequently, women work less. And, when they do work, they do fewer average hours, fuelling the gender gaps in pay, progress and opportunities.

“This represents a huge waste of resources and a drag on the economy. The predicament will only worsen as populations age and fertility rates keep falling. Governments and employers have a crucial role – indeed a responsibility – in promoting equality in the workplace.

“If anything good comes from the pandemic, let it be that it galvanises governments and employers to act swiftly to make the workplace more welcoming for women. In terms of both social fairness and economic efficiency, it’s the right thing to do.”