World Bank: Raising female labour force participation rates in South Asia to increase regional GDP by up to 51%

While remaining upbeat about growth prospects in South Asia, the World Bank has highlighted that unlocking untapped potential by increasing women’s participation in the labour force and further opening global trade and investment could help the region grow even faster and achieve its development goals.

The World Bank’s South Asia Development Update, October 2024 Women, Jobs and Growth has said that raising female labour force participation rates in the region to those of men would increase regional GDP by up to 51%.

“Female labour force participation in South Asia is among the lowest in the world. Only 32% of working-age women were in the labour force in 2023, compared to 77% of working-age men in the region. For all South Asian countries except Bhutan, female labour force participation rates in 2023 were 5 to 25 percentage points lower than in countries at similar levels of development,” said the report.

It further highlighted that this shortfall in the female labour force is most pronounced after marriage. “On average, once married, women in South Asia reduce their participation in the workforce by 12 percentage points, even before they have children,” it noted.

The shift toward service activities, usually associated with greater demand for female labour, has not yet led to higher levels of female employment in the region. Firms often state an explicit preference for male workers, it further noted, adding supply-side constraints such as childcare access, mobility and safety, legal restrictions, and conservative gender norms are also significant barriers.

The report has recommended legal reforms to improve gender equality, measures to accelerate job creation, and the removal of barriers to women working outside the home such as a lack of safe transport and quality child and elder care. “Such measures could be more effective if social norms became more accepting of female employment,” it noted. 

South Asia is likely to remain the fastest-growing region in the world with a GDP growth of 6.4% this year and is expected to remain robust at 6.2% a year for the next two years.

The report also highlighted another key area of reform--increasing trade openness. “Most countries in South Asia rank among the least open to global trade and investment. This greatly limits the region’s ability to take advantage of the reshaping of global supply chains. Within the region, greater export orientation has been linked to greater female employment,” it said, adding, that increased openness could help the region spur growth and boost job creation, especially for women.