(McKinsey Global Institute, April 2018)
Read the full article here: https://www.mckinsey.com/featured-insights/gender-equality/the-power-of-parity-advancing-womens-equality-in-asia-pacific
The McKinsey Global Institute (MGI), over the past three years, has compiled a series of reports projecting the economic impact of advancing equality for women across various regions of the world. In its first report in 2015 The Power of Parity: how advancing women’s equality to can add $ 12 trillion to global growth, MGI concluded that every region in the world had the potential to increase its GDP by 8 to 16% merely by leveraging the pent-up abilities of women who were being constrained from delivering their full economic potential. The Asia Pacific Region report is the latest and gives special attention to seven countries, one of which is Australia. The main thrust of the report is that the potential of women to contribute to the economies of their countries is under-utilised in every country in the region, although, of course, there are vast differences between individual countries some of which like Australia are notably much further along the journey to achieving gender parity.
The proposition that the paid work potential of women is not fully realised and that freeing them to play a more significant role in the workplace will bring about significant economic benefits has been a recurring theme argued by many economists. It has also been forcibly advanced by many global organisations including the World Bank, World Economic Forum, OECD and the investment bank Goldman Sachs. The Australian Government too, has acknowledged that advancing female work participation must be a central pillar of the nation’s economic policy. At the G20 conference in Brisbane in 2014 the government committed itself to reducing the participation gap between men and women by 25 % by the year 2025. A Grattan Institute Report (2016) indicated that giving females better work opportunities could boost Australian GDP by as much as 13%.
In its extensive and thoroughly researched report, MGI bringing to bear the skills of a range of seasoned economists and management experts projects the likely monetary benefits to countries in the Asia Pacific if strategies are implemented and structures put in place to accelerate moves towards gender parity. The region as whole could be better off, the report assesses, by an amount of US $ 4.5 trillion and Australia could reap large benefits of US. $ 225 billion. (Using a different form of economic modelling, a just-released report by KPMG: Ending workforce discrimination against women- calculates that Australia could benefit by $ 140 billion in 20 years if it increased female work participation). Understanding how the region could profit from increased gender parity requires a detailed analysis of where the gender gaps exist and how extensive they are. The report makes it clear that economic shortcomings are integrally linked with social disabilities faced by women in the countries of the region. MGI used 15 economic and social indicators to compile a Gender Parity Score for each country. These indicators are combined under 4 main headings as reflected in the graphic illustration below.