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2. Economic Recovery Action Plan – Immediate Strategies

A prerequisite for the design of any COVID-19 recovery strategy is that women must be included in all COVID-19 recovery taskforces and at every stage of decision-making processes. Without women’s active participation, there is a risk that their roles and contributions will be overlooked. Recognition and optimization of women’s experience and expertise are essential to economic recovery and long-term prosperity.

Women in the workforce boost productivity and profitability. A report by the Pipeline, a consultancy specializing in workplace diversity, noted that FTSE 350 companies in the UK that have executive committees with at least 33 per cent female representation have a net profit margin more than 10 times greater than do companies with no women at that level – 15.2 per cent versus 1.5 per cent.6 In fact, the 2020 iteration of the Pipeline’s annual ‘Women Count’ study found that the gap in net profit margin between companies with executive committee-level women and those without was the biggest recorded in five years of research.

And it is not just female executives or women in the formal economy who boost productivity. Examples highlighted in this paper underline the fact that, with the right tools and support, women earning less than $2 a day in rural villages or the informal economy can now, even in the midst of a devastating pandemic, successfully develop products and services that raise the social and economic well-being of their communities.

That said, many factors still prevent women from engaging in economic activity to their full potential, and thus from contributing as much as they could to the COVID-19 recovery. Among the most notable barriers are a lack of good, affordable childcare and long-term care, and a lack of collateral or access to finance. These barriers must be removed now if the world is to benefit from the expertise of women ready and eager to help rebuild robust and sustainable economies.

To address these issues, this paper presents a three-point COVID-19 recovery action plan for the formal and informal economies. The plan advocates the following principal areas of action:

  1. Invest in social infrastructure and family-friendly policies.
  2. Accelerate advances in women’s workforce competencies through professional and vocational education.
  3. Invest in the development of women-owned businesses in all countries.

Recommendations for immediate action

1. Invest in social infrastructure and family-friendly policies

Historically, the biggest increases in women’s workforce participation have been directly correlated to increased availability of care services, ‘family-friendly’ policies and income protection.7

Affordable, quality and professionalized childcare and long-term care

Investing in quality care will accelerate job creation, promote equity and improve women’s employment and productivity, child outcomes, family welfare, firm productivity and overall economic development.8 Furthermore, taking a human-centred approach to the COVID-19 crisis is essential, in order to ensure that the most vulnerable – e.g. the poor, older people, those living with HIV, indigenous people, and the physically and mentally impaired – are not left behind.

Recommendation: Expand/create and fund an integrated framework of care policies for the whole human lifecycle. Both government and private sector policies should cover a range of areas, including childcare, long-term care, and maternity, paternity and parental leave. The framework should be designed to help foster shared responsibility between men and women, between the state and the market, and between families and communities.

Accessible, affordable, quality healthcare

Providing access to healthcare to protect people’s livelihoods as well as their financial resources is a win-win for individuals and the economy.

Recommendation: States must implement universal, publicly financed health systems that cover their entire population – not only for COVID-19 services but for all essential services, ranging from physical and mental health promotion to disability support, disease prevention, care and cure, sexual and reproductive health, and palliative care.

Social and income protection

More than 740 million women work in the informal economy.9 The pandemic has exposed the sheer volume and vulnerability of this cohort, and how the precarious living conditions of vast communities can quickly deteriorate.

Recommendations: To protect millions of vulnerable workers, states must urgently expand social protection policies to include all workers, whether in the formal or informal economy. The protection should include domestic and migrant workers.

Subject to each state’s situation, a minimum guaranteed income should be considered. Any such scheme should include a gender impact assessment and should be designed to help the most vulnerable in the community overcome the economic impacts of COVID-19.

Governments must invest in the development of new and innovative ways to increase women’s access to domestic-violence prevention services, protection, medical help, shelters and legal services, including hotline systems for reporting and combating domestic violence.

2. Accelerate advances in women’s workforce competencies through professional and vocational education

Digital training needs will become ever more pressing. Recent research has concluded that by 2030, given the digital transformation of work, between 40 million and 160 million women working today will need to acquire new technology skills to remain employable.10

Skilling, reskilling and upskilling

Aligning market needs and training with talented women who want to enter or re-enter the workforce after a COVID-19 lockdown or child-raising presents a win-win scenario – both for companies’ recovery in the long term and for women’s economic independence.

Recommendations: Public and private education must ensure women and girls have access to, and participate in, education and training (whether online or otherwise). Special attention should be paid to technical and vocational education, e-skills, financial literacy and lifelong learning opportunities.

Governments should embed digital, technology and entrepreneurial training as requirements for receipt of unemployment and/or social welfare benefits for women who have become unemployed (or have had to quit their jobs because of lack of care services) in order to upskill or reskill them, and to facilitate their re-entry into the labour force. This is particularly critical for women aged 55 and above, to ensure their continued economic independence and to reduce the burden on social protection programmes.

3. Invest in the development of women-owned businesses in all countries

According to a motion on women’s entrepreneurship in small and medium-sized enterprises (SMEs)11 presented to the European Parliament Committee on Women’s Rights and Gender Equality, 99 per cent of start-ups in Europe are micro- or small enterprises. One-third of these are started by unemployed people. Micro-enterprises that employ fewer than 10 people make up 91 per cent of European businesses. Given the massive number of women who have lost their jobs due to COVID-19, the potential to promote women-owned business start-ups via seed investment is huge.

Some aspects of women’s entrepreneurship – such as lack of access to finance to launch or scale their businesses, or inequal access to procurement tenders – are often depicted as impediments to closing the gender enterprise gap. However, in certain cases these can be overcome using e-commerce as the business model. For example, younger entrepreneurs are more inclined to adopt technology and adapt it to support business growth. E-commerce (using technologies such as mobile commerce, electronic funds transfer, supply chain management, internet marketing, online transaction processing, electronic data interchange, etc.) is one of the key enablers for women-led businesses. It also facilitates international trade and promotes environmentally sustainable businesses.

The case for increased investment in women-owned businesses is further supported by the fact that women tend to be relatively good credit risks. For example, members of the Financial Alliance for Women (a network of financial organizations dedicated to championing women’s role in the economy) confirm that their respective institutions have better-performing debt portfolios from women entrepreneurs than they do from men.

One of the least recognized – but potentially most effective – economic engines consists of senior women entrepreneurs. Research from Global Entrepreneurship Monitor (GEM)12 has demonstrated the following:

  • The highest rate of entrepreneurship worldwide has shifted to the 55–64 age group.
  • Entrepreneurial activity among the over-50s has increased by more than 50 per cent since 2008, with more than 60 per cent of such entrepreneurs being women. These senior entrepreneurs are twice as likely to establish successful companies as are those aged 20–34.
  • Five years after start-up, 70 per cent of ventures established by senior entrepreneurs are still in operation, compared with just 28 per cent of enterprises launched by younger entrepreneurs.

Business support, access to finance, and digital literacy

With the right tools and support, women entrepreneurs can have a dramatic positive effect on economies locally, nationally and even globally. However, they often lack basic elements – such as access to digital tools, computer knowledge, business and marketing skills, financial literacy and access to loans – that would allow them to develop and scale their businesses. Finding innovative solutions to counter cultural and regulatory barriers such as ownership rights would also level the playing field and provide a better business environment for women.

Recommendations: Governments and private sector investors must develop and fund action plans to stimulate unemployed women’s participation in entrepreneurship and innovation ecosystems by supporting women-owned business start-ups, particularly in e-commerce and the digital economy.

Governments and private sector corporations must develop transparent targets and tracking mechanisms to ensure that funds which local and national governments are dedicating to the support of micro-enterprises and SMEs also go to women-owned businesses – in proportion to their prevalence in the market. The same should apply for credit lines.

Governments and private sector corporations must review public and corporate procurement policies and practices to make them gender-inclusive – including, if necessary, establishing affirmative action measures to create a ‘diversity dividend’ through increased job creation and economic growth.

Governments and private sector corporations should implement entrepreneurship training programmes designed for senior women about to retire from public or private sector jobs, to help them translate their experience and expertise into developing business start-ups that will generate jobs for others, as well as secure their economic independence.

Access to ICT and digital tools to support financial inclusion and e-commerce

Recommendation: Governments (local and national) need to create and/or support fully integrated platforms for unemployed women to build businesses from home. Features should include online marketplaces, access to micro-finance, payments systems, and self-help mechanisms to encourage women to learn entrepreneurial skills.

Innovative financing mechanisms

Recommendation: The investment community should be incentivized to incorporate a gender lens in its decision-making across all asset classes. It should foster the development of gender-responsive business loan officers, with a view to increasing women’s access to capital.

6 McDonagh, M. and Fitzsimmons, L. (2020), Women Count 2020, London: The Pipeline, https://www.execpipeline.com/wp-content/uploads/2020/07/The-Pipeline-Women-Count-2020-FINAL-VERSION.pdf.
7 Sochet (2019), ‘The Child Care Crisis Is Keeping Women Out of the Workforce’.
8 Ibid.
9 International Labour Organization (2018), ‘More than 60 per cent of the world’s employed population are in the informal economy’, press release, 30 April 2018, https://www.ilo.org/global/about-the-ilo/newsroom/news/WCMS_627189/lang--en/index.htm.
10 Madgavkar, A., Manyika, J., Krishnan, M., Ellingrud, K., Yee, L., Woetzel, J., Chui, M., Hunt, V. and Balakrishnan, S. (2019), The future of women at work: Transitions in the age of automation, McKinsey & Company, https://www.mckinsey.com/featured-insights/gender-equality/the-future-of-women-at-work-transitions-in-the-age-of-automation.
11 European Parliament (2011), Report on women entrepreneurship in small and medium-sized enterprises (2010/2275INI), Committee on Women’s Rights and Gender Equity, Rapporteur: Marina Yannakoudakis, https://www.europarl.europa.eu/sides/getDoc.do?type=REPORT&reference=A7-2011-0207&language=EN.
12 Global Entrepreneurship Monitor (2020), ‘Entrepreneurs Worldwide Motivated to Make a Difference’, press release, 3 March 2020, https://www.gemconsortium.org/latest-global-reports.