Why womenomics is becoming a mathematical necessity
The theory of 'womenomics' – that increasing women's workforce participation boosts economic growth – was popularised nearly three decades ago by Kathy Matsui, a former Goldman Sachs executive, based on her study of imbalances in Japan.
The International Monetary Fund, the World Bank and the OECD have consistently promoted a similar thesis: investing in greater female labour force participation pays off in the form of higher GDP.
In 2015, McKinsey put a number on the idea, by estimating that $28 trillion could be added to global economic output over the ensuing decade if women played an identical role in labour markets to that of men.
In a world economy reeling under crises and profound change, is womenomics still relevant? Maybe more so than at any point in history.
The global economy is now faced with a historically low growth rate of 2.8 per cent this year. For advanced economies the forecast is just 1.4 per cent, while for emerging and developing economies it's 3.7 per cent. Short-term headwinds are symptoms of a momentous longer-term transformation, driven by technology and geopolitics and making just about every type of indicator far more uncertain and difficult to predict.
In this context, countries are seeking strategies to boost growth through domestic measures. They are working towards more regional and bilateral trade agreements, pursuing industrial policy often with security and self-reliance considerations, boosting local demand and consumption, and aiming to attract local and foreign investment to newly emerging growth areas.
Central to these endeavours is talent. In past waves of globalisation, many countries competed on the basis of cheap labour alone. This will no longer suffice. Trading will require more refined skills, boosting domestic demand will need a focus on analysing local incomes and spending behaviour, and attracting investment will require a focus on the quality of local human capital.
In 109 of the 148 countries covered in the World Economic Forum's Global Gender Gap Report 2025, women are enrolled in tertiary degrees in equal or higher numbers than men. And yet, men continue to comprise 65 per cent of workers without a tertiary degree, and 60 per cent of those with one.
Among tertiary educated women, just 29.5 per cent make it to top leadership, despite representing 40.3 per cent of the overall workforce. Even for women with master's or bachelor's degrees, top-level representation plateaus below 31 per cent. Women's talent remains a stranded asset in much of the world.
The cheapest form of stimulus in a down economy can therefore come by bringing university educated women into the workforce, including leadership roles. This is particularly true at a time when already constrained fiscal space limits other options.
There's also a secondary, but no less important, role for womenomics in a turbulent economy driven by geopolitical conflict, threatened by climate change and facing both the risks and opportunities of new technologies.
Solving problems often relies on a diversity of thought, knowledge and experience. So does the creativity necessary to unleash innovation in the form of new technologies and scientific breakthroughs. This is true across teams and organisations.
The pattern holds for entire countries. Economies that tap into the full spectrum of their talent and human capital are best positioned to accelerate innovation, productivity and prosperity, even more so amid unprecedented uncertainty.
Demographic pressures create a third vital role for womenomics in an uncertain economy. With the exception of countries in sub-Saharan Africa and parts of emerging Asia, much of the world is faced with a declining working-age population. It peaked in Germany in 1986, in the US in 2007 and in China in 2010. Even with technology driven job losses, there is a net rise in demand for talent for growing roles in agriculture, teaching, technology, health and more.
Amid increased polarisation and pushback on migration, greater female labour participation will be a mathematical necessity to maintain productivity.
Yet, the question remains: is progress possible?
In two decades of tracking gender parity, despite slow movement in global averages, we've found that the answer is a resounding 'yes'.
Since 2006, gender gaps have closed in terms of senior economic leadership (by more than 17 percentage points), in professional and technical roles (by seven percentage points), higher education (by about 16 percentage points), and representation in both governing cabinets and legislative bodies (by nearly 13 and 15 percentage points, respectively).
Among the 100 countries we have consistently tracked over the years, 99 have closed gender gaps – some remarkably quickly, through a blend of smart strategy and policy.
Economies sprinting to parity include Bangladesh, Ethiopia, Mexico, Saudi Arabia and the UAE. Among regions, Latin America and the Caribbean made the biggest leap over the years. If its progress continues at current rates, it's on track to become the first region to close the overall gap.
Of course, there are looming risks to contend with. Technology is displacing jobs in fields that employ a majority of women, while more pervasive use of AI may disproportionately impact women's white-collar careers.
Fragmenting trade and global supply chains could roll back decades of progress for women who have increasingly gained formal employment in export-driven industries like clothing and textiles in lower and middle-income countries.
In addition, inadequate care economies in most countries are disproportionately placing the burden on women who would otherwise be in the formal workforce.
But relatively small investments in care infrastructure, gender-lens reskilling and upskilling, and supporting job transitions for women in trade and tech-disrupted sectors would provide immense returns.
It may not be a new concept, but womenomics is essential for navigating the new economy.
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