Investing in access to essential services and reducing the gap in labor-force participation rates could significantly expand the global economy by 2025.
In 2015, the McKinsey Global Institute published The power of parity: How advancing women’s equality can add $12 trillion to global growth. This report, which focused on the enormous potential associated with narrowing the gender gap, found that if every country did so at the same historical rate as the fastest-improving country in its regional peer group, the world could add $12 trillion to annual gross domestic product in 2025. That’s some 11 percent higher than it would be under the business-as-usual scenario.
So what will it actually take to turn this potential into reality? Our new discussion paper, Delivering the power of parity: Toward a more gender-equal society, provides an agenda for action and investment, quantifying the progress needed on 15 gender-inequality indicators. It finds that while much of the $12 trillion opportunity comes from advancing gender equality in the world of work, progress there is closely tied to tackling gender gaps in society more broadly. In particular, improved access to services in six areas could unlock economic opportunities for women: education, family planning, maternal health, financial inclusion, digital inclusion, and assistance with unpaid care.
Addressing these areas would require incremental annual expenditures of $1.5 trillion to $2 trillion in 2025—20 to 30 percent more than would ordinarily be spent given the current trajectories of rising population and GDP (exhibit). But the results would empower millions of women and men alike, delivering economic benefits that are six to eight times higher than the social spending estimated.
This discussion paper will be presented at the Women Deliver global conference, to be held in Copenhagen from May 16 to May 19.