Many governments move to improve Women’s economic inclusion

Governments in 65 economies took steps to improve women’s economic inclusion, enacting 87 legal reforms in the past two years, says the World Bank Group’s Women, Business and Law 2018 report, released today.

However, women continue to face widespread barriers, entrenched in laws, that keep them out of jobs and prevent them from owning a business by restricting their access to credit or control over marital property, says the biennial report, which now monitors 189 economies. For example, it finds that in 104 economies women are barred from working at night or in certain jobs in many areas, including manufacturing, construction, energy, agriculture, water and transportation. This negatively affects the choices of more than 2.7 billion women.

“No economy can grow to its full potential unless women and men participate fully,” said World Bank Chief Executive Officer Kristalina Georgieva.Yet in more than half the world women are still prevented from working in certain jobs simply because of their gender. The report finds that where there is gender equality in labor laws, more women work and earn more relative to men. Women should have the same equality of opportunity as men to provide for themselves, and to give their children the best start in life possible.”

Now in its 5th edition, the report introduces, for the first time, a scoring system of 0 to 100, to better inform the reform agenda. Scores are assigned to every monitored economy on each of the report’s seven indicators: accessing institutions, using property, getting a job, providing incentives to work, going to court, building credit, and protecting women from violence.

While no economy gets the perfect score of 100 in all seven indicators, economies that perform well across the indicators include the United Kingdom, New Zealand and Spain. OECD high-income economies generally have the highest average score across most indicators.

Protecting women against violence, through laws against domestic violence and sexual harassment at work or in educational facilities, remains an area where much work is needed. Of the 189 economies examined, 45 do not have laws on domestic violence and 59 do not have laws against sexual harassment in employment. Overall, 21 economies receive a score of 0 in the protecting women from violence indicator. Many of these economies are located in Sub-Saharan Africa and in the Middle East and North Africa.

Although the vast majority of the economies monitored have laws establishing non-discrimination in employment based on gender, only 76 mandate equal remuneration for work of equal value and 37 economies have no laws protecting pregnant workers from dismissal.

In the area of building credit as well there is much room for improvement. Legislation prohibiting gender-based discrimination in financial services exists in only 72 economies, with 79 economies scoring 0 on this measure. Low income economies perform particularly poorly, with an average score of eight.

“Giving women equal opportunity is a moral and economic imperative and rescinding discriminatory laws is an important first step. We hope the Women, Business and the Law data, which is publicly available, will be used to make the much-needed changes to enable women to make the choices that are best for them, their families and their communities,” said Shanta Devarajan, the World Bank’s Senior Director for Development Economics.

The report cites research that shows that gender gaps cause an average income loss of 15 percent in the OECD economies, 40 percent of which is due to entrepreneurship gaps. Losses are estimated to be significantly higher in developing countries. Gender discrimination by law is also estimated to decrease female labor force participation and undermine economic growth. Research estimates that for some economies, a large fraction of country differences in output per capita can be attributed to gender inequality, and many countries can increase output per capita by discouraging gender barriers in the labor market.

“Unfortunately, laws are a straight line for men and a maze for many women around the world. And that needs to change. There is no reason to keep women out of certain jobs or prevent them from owning a business. Our message is simple: no women, no growth,” said Sarah Iqbal, Program Manager of the Women, Business and the Law project.

This year’s report includes a case study on women’s financial inclusion, examining how discriminatory laws can affect women’s demand for financial services. For example, limited access to and control over property constrain women’s ability to provide collateral for loans.

The report records multiple reforms in some developing countries. These include the Democratic Republic of Congo, Iraq, Kenya, Tanzania, and Zambia.

By region, economies in East Asia and the Pacific implemented 11 of the 87 reforms carried out globally in the past two years. Highlights of reforms in the region included China, which expanded paid maternity for women under 25 years of age to equalize this benefit for all women; Kiribati, where a new labor code has lifted all restrictions on women’s employment; and Malaysia, which now allows victims of sexual harassment to seek civil remedies. The region generally performs well on the accessing institutions indicator, with an average score of 95, as most economies do not differentiate between women and men in a range of public interactions, such as registering a business, opening a bank account or obtaining a national identification. The region also performs well in the using property indicator, averaging a score of 83, with marital property regimes that empower women. However, East Asia and the Pacific economies average a score of only 19 in the area of building credit, which constrains women’s access to finance, with 13 of the region’s 25 economies scoring 0 on this indicator. The region also performs poorly in protecting women against violence, with an average score of 44.

Fifteen of the past two years’ reforms were carried out in the Europe and Central Asia region. Highlights of reforms included Bosnia and Herzegovina, which eliminated several restrictions on women’s employment, including in jobs deemed arduous, hazardous and underwater work; Bulgaria, where all restrictions on women’s employment were removed; and Tajikistan, which abolished a restriction on women’s night work.

The region’s 25 economies generally perform well across most indicators, averaging a perfect score of 100 in the using property indicator and 99 on accessing institutions. However, widespread gender-based job restrictions continue to prevail in the region, which earns an average score of 77 on the getting a job indicator, with only Latvia and Lithuania earning a perfect score on this indicator.

The region’s poorest performance is in the area of building credit, with an average score of 33; seven economies receive 0 and only two receive 100 on this indicator. Another underperforming area is protecting women against violence, on which the region receives a score of 59, with almost a quarter of the region’s economies lacking workplace harassment laws.

Economies in Latin America and the Caribbean carried out 8 reforms in the past two years. Highlights of reforms include Colombia, where the Constitutional Court struck down job restrictions on women’s employment; and Ecuador, which equalized men’s and women’s property rights by no longer allowing a husband’s decisions to prevail when spouses disagree on how to administer assets. The region’s strengths lie in the areas of using property and accessing institutions, with an average score of 98 and 97, respectively. On both indicators, all economies on the Latin America continent score a perfect 100 and varying scores in the Caribbean Islands. The region could improve on the getting a job indicator. Of the 32 economies covered in the region, less than half meet the International Labor Organization standard of 14 weeks or more of maternity leave.

Economies in the Middle East and North Africa carried out 10 reforms in the past two years. Iraq, with four reforms, earned a spot amongst the world’s top five economies with the most reforms. Iraq’s reforms covered the areas of accessing institutions, getting a job, providing incentives to work, and protecting women against violence. In the area of getting a job, Iraq increased the length of paid maternity leave from 72 to 98 days and its new labor code prohibits discrimination based on gender. However, the new labor code also allows employers to terminate workers’ contracts when they reach retirement age, which is lower by five years for women. In fact, 58 percent of the region’s 20 economies have gender-differentiated retirement ages. The region also has the fewest protections for violence against women, with more than one-third of the economies scoring 0 on this indicator. Seventy percent of economies have no legislation on sexual harassment at work. Overall, the region has the world’s lowest average scores on four indicators.

In South Asia, four reforms were implemented in the past two years. Highlights of reforms included Afghanistan, where sexual harassment in employment and education are now prohibited and criminal penalties and civil remedies for sexual harassment in employment established. In India, the length of paid maternity leave was increased from 84 to 182 days. However, as employers bear the full cost of maternity leave, this could have a negative impact on the hiring of women of childbearing age. Bangladesh, on the other hand, introduced new restrictions on the work women can doby prohibiting women from carrying or lifting heavy goods. With an average score of 39, South Asia has the lowest score in the world on the getting a job indicator. The region also has the poorest performance in the building credit indicator, with an average score of only nine. South Asia’s eight economies perform well in the area of protecting women against violence, with average score 85, besting even high-income OECD’s average score of 75. Every economy in South Asia now has laws prohibiting sexual harassment in employment.

Sub-Saharan Africa is home to four of the world’s five economies which implemented the most reforms in the past two years. With 13 reforms collectively implemented by the Democratic Republic of Congo, Kenya, Tanzania, and Zambia, the region accounted for a total of 34 reforms. Nearly a third of these reforms were in the area of building credit, a weak point around the world, including in high-income OECD. With an average score of 19, Sub-Saharan Africa is on par with East Asia and Pacific on this indicator.

The region also carried out almost half of the world’s 13 reforms to protect women against violence. However, of the world’s 45 economies with no laws against domestic violence, 19 are in Sub-Saharan Africa, earning the region an average score of 46 on this indicator. The region performs well in the areas of accessing institutions, with an average score of 87. In fact, 20 of the region’s 47 monitored economies receive 100 on this indicator, with not a single economy earning 0. Using property is another area of relative strength for the region, with an average score of 76, and 16 economies with a perfect score.

The full report and accompanying datasets are available at http://wbl.worldbank.org

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