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Gender-Equality and Economic Recovery Vicky Pryce, Chief Economic Adviser and board member, Centre for Economics and Business Research, examines the impact of COVID-19 on the progress of gender-equality and argues that economic recovery for everyone would be helped by free childcare for under-fives. In the long-term it would pay for itself. Vicky Pryce
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he case for targeted support for women to ensure they can return to work and contribute to the economic recovery, when the crisis comes under control, is overwhelming. According to the UN women represent globally some 70% of health workers1. In the UK, women dominate the front line of the national health service and care sector and are therefore more exposed to the disease itself. At the same time, they have been amongst the worst affected by job losses. Globally, the estimate is that women are almost twice as likely to be losing their jobs during the pandemic. There is a real danger that any progress we have seen in gender equality will be going backwards due to COVID. Short-term and long-term consequences The adverse short-term consequences may leave a trail of longer-term issues that will need to be addressed by policymakers around the world. But the problem is not confined to developing countries. An IMF study using anonymised Vodaphone and other data in Italy, Spain and Portugal to track mobility of people, since the pandemic, found that though mobility of both men and women dropped substantially as countries got closer to and then into a lockdown, that of women dropped even more as the chart below, which appeared in the IMF’s World Economic Outlook in October 2020 indicates.
The question of course is how quickly that will get reversed. If not, we may well end up post-pandemic with an even bigger pay gap than before. We know that, during normal times, the pay gap starts to widen after women have their first child and continues to widen for a good 12 years thereafter. What is less well-known is that this is mirrored in the widening gap between the commuting distance to work between men and women, as women search for jobs closer to home that offer greater flexibility and fit with their childcare arrangements, for which they still are the main ones responsible in the household. This is shown in the chart below produced by the Institute of Fiscal Studies. What it shows is that the more the radius within which one is searching for jobs must be shrunk in size to ensure there is good proximity with school/nursery/home, the more the pay gap between those not constrained by this – mostly men – widens.
The result of course is that women who assume the main childcare responsibility are penalised financially for the flexibility they need, particularly if they also end up working part-time, as 42% of working women in the UK do. The gap between full-time men’s hourly wage and part-time hourly wage is as high as 34%. Not only are women therefore on average poorer during their lifetime than the men but also suffer in relation to benefits on retirement. By the time a woman in the UK reaches pension age for example, her pension wealth on average is about a fifth of that of the average man. 18 | LegalWomen
