There is a multiplier effect as well. Women are more likely than men to invest in their children’s education, which can lead to a boost in economic growth, especially as those children grow up and enter the workforce themselves. Moreover, women who are economically active tend to have fewer children, and this often translates to fewer children living in poverty.
“Giving women the chance to become financially independent and make the most of their talents is the key to higher living standards and stronger economies,” says Cherie Blair, founder of the Cherie Blair Foundation for Women, which supports entrepreneurs in Asia, Africa, and the Middle East. “This is more true today than ever before. With the global economy still struggling through a slow and spotty recovery, it is in everyone’s interest to help women make the most of their potential. No real social progress is possible without the economic progress of the Third Billion.”
Before anyone pops open the champagne, we need to emphasize that the notable achievements, in virtually all cases, represent relative progress, not absolute success. Many of the countries that scored highest in our rankings benefited from comparisons against others with poorer track records in empowering women. For example, Germany ranked very high in the equal-pay category, along with other developed nations such as Australia, the Netherlands, Norway, and Sweden. However, women in virtually all of these countries still earn lower salaries than men. In Germany, women on average earn 23 percent less than men earn for similar work.
Some of that disparity stems from structural differences. German women with greater family responsibilities and obligations often choose to avoid demanding careers that require long hours and frequent travel. However, even correcting for these differences and assessing only the salaries of men and women holding similar jobs, with similar tenure and qualifications, there is a salary gap of approximately 8 percent. That’s better than most other countries, and it represents a genuine advance, but it’s still not equal pay for equal work.
Similarly, in the U.S., although women are rising into the ranks of middle management, many are not yet taking the final step into senior positions. In 2011, women held just 16.1 percent of board seats at Fortune 500 companies and 14.1 percent of senior executive positions. Less-developed countries have even worse records: A World Economic Forum survey of Indian employers in 2010 found that women employees held just one in 10 of the senior management positions at responding companies.
The women who make up the Third Billion are not a homogeneous demographic bloc. They represent a multitude of nationalities, ethnicities, and religions. They live in cities, in small towns, in villages, and on farms. They are young and old, married and single, experienced and inexperienced. Finally, they are products of the places where they live, with the constraints and opportunities unique to those regions, countries, states, and cities. And as such, they require an array of customized solutions to help them reach their potential.
There are many reasons that countries around the world have failed to realize the economic potential of women. Our analysis groups these reasons into two deficiencies: Women are either (1) not prepared or (2) not enabled to join the workforce. “Prepared” refers to having received a sufficient education, usually defined as the completion of secondary school. As women progress through rising education levels, they gain a sense of empowerment that allows them to make more decisions and participate in the labor market. “Enabled” refers to having sufficient social and political support to engage with the labor market. This support spans family, logistical, legal, and financial dimensions.