The ROI From College

Gender Issues: Women’s Labor Days

by Elaine Schwartz    •    Sep 2, 2013    •    686 Views

What if a billion underutilized women entered the global economy during the next 10 years?

Economies might get these growth rate boosts:

  • Sweden: 2%
  • US: 5%
  • Brazil: 9%
  • Japan: 9%
  • South Africa: 10%
  • United Arab Emirates: 12%
  • India: 27%

How? An OECD (Organization for Economic Cooperation and Development) Report says that education is crucial. Because one extra year of education per capita raises per person output by 10%, elevating girls’ educational opportunities to the level of her male peers could have a huge economic impact.

In the developed world, though, the problem is not educational equity. Girls tend to get better grades and are more likely to graduate college than men. However, men still dominate STEM (science, technology, engineering, mathematics)-studies. As a result, males are enjoying higher incomes and countries are losing out on female human capital. We still have female stereotyping that creates underutilization.

By contrast, in the developing world the educational experience for males and females can be very different. At the primary school level, enrollment is nearly universal except for countries in Sub-Saharan Africa and South Asia. However, at the secondary level, the divide is much more apparent. Especially in Eastern, Middle Central and Western Africa and in Southern Asia, boys are more likely to remain in secondary school.

Education is the perfect example of a positive externality. Initially just between the individual and her teacher, the positive impact ripples far beyond across society and through subsequent generations. Better educated moms mean better child care, later marriages, lower infant mortality rates. Their increase in human capital fuels productivity and innovation.

You can see (below) where a diminished education gender gap can make a difference:

Gender Issues Participation rates

Sources and Resources: The facts I present are a blend of 2 reports, one from the OECD (Organization for Economic Cooperation and Development) and the other from the consulting firm, Booz and Co. In the past, econlife has looked at how female human capital is underutilized.

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