Closing the wage gap

An IMF report on Pakistan’s economy has made a strong case for improving equal participation for women. The Pursuing Women’s Economic Empowerment report has pointed to the need for equal jobs, equitable pay and improved participation for women in economic activities. It has also drawn attention to an ignored dimension of the gender pay gap in the country: that it could cause the GDP to jump by 30 percent. This might not be the right reason to increase wages for women, but it might appeal to those who find pure economic logic more appealing. While female participation in our economy remains fairly high, most of it exists in the form of agricultural, household or home-based labour. Most of these are heavily underpaid forms of labour – even though they require skill. Women’s participation in the labour force has continued to be cast as an ‘add-on’ to their duties in their own household – which means their being treated as less than full workers. The IMF report points to the value of treating women as full workers in the economy, which would improve their wages and, in turn, push an increase in the GDP as well.

The report has also pointed to the measures that we often hear about: improve education attainment for women, address inequality in inheritance rights, and support for small and medium-sized industries operated by women. It advocates cash transfers to keep girls in school, making small loans available for female entrepreneurs and potentially offering tax deductions to women who own property. Not only would improving women’s participation improve Pakistan’s GDP, it would also push the GDP of developed countries like Japan and Canada up by four percent. The principle behind the report is an important one. But it is important for national governments to adapt the principles to their own environment. More so, it is important for all of this to be addressed through a coherent national policy for women’s participation in the economy. Right now, they continue to be integrated into the economy as informal workers. The real need is for women to be recognised as full workers equal to men, with equal rights as equal participants in our national economy – and not as secondary citizens. The gender wage gap needs to be eliminated as a key step forward towards progress. The workplace is the place to start.