Gender Inequality and the Global Labor Market: Why Economic Growth Has Not Meant Empowerment

theconvergencys
Nov 20, 2025
5 min read

By Sarah Li Oct. 15, 2024

I – Introduction

For decades, policymakers have treated economic growth as a proxy for gender equality, assuming that expanding labor markets would naturally empower women. Yet despite historic increases in female labor-force participation, structural inequality persists. The International Labour Organization (ILO, 2025) reports that women’s global labor participation rate remains 27 percentage points below men’s, a gap largely unchanged since 1990. Women perform 76 percent of unpaid care work worldwide, contributing an estimated $11 trillion annually to the global economy — labor that remains invisible in GDP calculations.

This article examines how gender inequality is sustained not by cultural inertia alone but by economic design. Through wage structures, occupational segregation, and policy neglect, the global economy extracts value from gendered labor while denying women equitable compensation and decision-making power.

II – The Wage Gap and Economic Structure

The global gender wage gap averages 19 percent, but the disparity widens in high-skill sectors and informal economies. According to OECD Employment Data (2025), women in finance and technology earn 26 percent less than men, while in informal manufacturing and agriculture, wage gaps often exceed 40 percent. These disparities cannot be explained solely by education or experience.

Rather, they reflect institutional biases in wage-setting mechanisms. Care work, education, and healthcare — industries dominated by women — are systematically undervalued because they generate social rather than shareholder returns. Economists call this the care penalty: for every 10 percent increase in the share of women in an occupation, average wages decline by 1.5 percent (Harvard Kennedy School Gender Policy Review, 2024).

At the same time, automation threatens to reinforce these inequalities. Routine and clerical jobs, disproportionately filled by women, face higher automation risks. The World Economic Forum Future of Jobs Report (2025) projects that 52 percent of administrative positions — where women represent 60 percent of the workforce — will be displaced by 2030. Without retraining and policy intervention, digitalization could widen rather than close the gender divide.

III – Unpaid Labor and the Invisible Economy

Beyond wages lies a larger, unacknowledged system: unpaid domestic and care work. Women spend an average of 4.5 hours daily on unpaid labor, compared with 1.7 hours for men (UN Women Time Use Survey, 2025). This disparity traps millions in part-time or informal employment, reducing lifetime earnings and pension contributions.

If unpaid care were counted as formal labor, global GDP would rise by roughly 9 percent (McKinsey Global Institute Gender Parity Report, 2025). Yet most nations lack infrastructure — childcare, parental leave, elder care — to redistribute these responsibilities. In OECD countries, only 32 percent of children under three have access to affordable childcare, and in low-income nations, that figure falls below 10 percent.

The absence of supportive policy reinforces intergenerational inequality. Women’s reduced lifetime earnings translate into lower savings and economic vulnerability in old age. The World Bank Pension Gender Gap Study (2024) found that women’s retirement benefits are 33 percent lower on average, creating what scholars call the second pay gap — the price of unpaid care across a lifetime.

IV – Political Economy and Representation

Gender inequality persists not only in households and workplaces but also in policymaking. Women hold just 26 percent of parliamentary seats worldwide and 22 percent of ministerial positions (UN Women Global Equality Index, 2025). When fiscal and trade decisions are made without gender lenses, policies often exacerbate rather than alleviate inequity.

Consider taxation: indirect taxes such as value-added taxes (VAT) disproportionately affect women, who spend a larger share of income on basic goods and family consumption. Meanwhile, corporate tax incentives benefit male-dominated industries like construction and energy more than service sectors where women cluster.

Trade liberalization, too, has mixed outcomes. Export-oriented manufacturing has created millions of jobs for women in Asia and Latin America, yet these positions remain concentrated in low-wage, precarious segments of supply chains. When crises strike — such as the COVID-19 pandemic or the 2023 textile slowdown — women are the first dismissed and the last rehired. The International Trade Centre (2024) reports that women-owned enterprises received only 1 percent of global procurement contracts, despite representing one-third of small businesses.

The underlying pattern is clear: economic globalization integrates women into production, but not into power.

V – Toward a Gender-Just Economy

Correcting gender inequality requires more than social reform — it demands economic redesign. Three policy directions can redefine the relationship between gender and growth:

1. Care as Infrastructure Public investment in care services should be treated as economic stimulus. The OECD Inclusive Growth Model (2025) finds that every $1 invested in childcare and elder care creates 2.3 jobs, primarily for women, while raising female labor-force participation by up to 10 percentage points.

2. Pay Equity and Transparency Legislation Mandatory disclosure of gender pay ratios has proven effective. Iceland’s Equal Pay Certification Act (2024) reduced its wage gap to under 5 percent — the smallest in the world — by requiring firms to prove equal pay for equal work or face fines.

3. Gender-Responsive Budgeting National budgets should evaluate fiscal policy impacts by gender. The Philippines Gender Budgeting Framework allocates 5 percent of all government spending to gender equality programs, leading to measurable improvements in maternal health and female entrepreneurship.

Each reform reframes equality as an economic multiplier, not a moral accessory. When gender equity becomes a fiscal priority, growth and justice converge.

VI – Conclusion

The global economy remains built on the unpaid, underpaid, and unrecognized labor of women. Growth alone will not deliver equality when its foundations rest on exploitation. True empowerment demands a political economy that values care, redistributes power, and measures prosperity not by GDP but by inclusion.

As long as gender determines both who works and who benefits from that work, progress will remain partial. A fair economy is not one where women join the labor force on unequal terms, but one where equality itself becomes a source of growth.

Works Cited (MLA)

International Labour Organization World Employment Outlook 2025. ILO, 2025.
OECD Employment Data 2025. Organisation for Economic Co-operation and Development, 2025.
Harvard Kennedy School Gender Policy Review 2024. Harvard University, 2024.
World Economic Forum Future of Jobs Report 2025. World Economic Forum, 2025.
UN Women Global Time Use Survey 2025. United Nations Women, 2025.
McKinsey Global Institute Gender Parity Report 2025. McKinsey & Company, 2025.
World Bank Pension Gender Gap Study 2024. World Bank, 2024.
UN Women Global Equality Index 2025. United Nations Women, 2025.
International Trade Centre Women and Trade Review 2024. ITC, 2024.
OECD Inclusive Growth Model 2025. OECD, 2025.
Iceland Equal Pay Certification Act Implementation Report 2024. Government of Iceland, 2024.