Women in the workforce hold the key to a vibrant economy. Though Pakistan has seen a turnaround in economic stability, without women's participation in the workforce, accelerated growth will be a challenge. Despite a slow increase in the last 16 years, a mere 22 percent of women (compared to 67.8 percent of men) officially partake in some economic activity in Pakistan. This is one of the lowest rates of female labour force's participation in the region, second only to Afghanistan. By comparison, in Vietnam and Bangladesh, the female labour force's participation rate is 73 percent and 36 percent, respectively, and women are recognised as a key economic force.
Low female labour force participation has clear implications for accelerated economic growth in Pakistan. A 2016 IMF paper estimates that closing gender gaps in economic participation could boost GDP in Pakistan by up to 30 percent. Beyond smart economics, closing gaps between men and women, girls and boys has intrinsic value for the virtuous cycle it creates for gains in families, communities and national economies.
Initiatives such as the Benazir Income Support Programme (BISP) have been cognizant of this virtuous cycle. BISP has made phenomenal gains for women across a number of dimensions. These range from access to finance, increased savings, as well as improved access to healthcare. Financial empowerment enables women to plan, invest in, and aspire to a better future; and to transfer these aspirations to their children. However, a lot of work remains to be done – only 3 to 5 percent of women have bank accounts in Pakistan.
Why the female labour force's participation in Pakistan is so low? The answer to this question lies in both demand and supply side aspects of labour. On the supply side, policymakers and private sector job creators must pay attention not only towards generating employment opportunities for women, but also to the quality of work. Today in Pakistan, even amongst women counted in the labour force, only 3 percent are involved in the formal sector; and crowded into historically low-paying, female-dominated jobs. The male-female wage differential in Pakistan is almost 67 percent. On the demand side, there is a need to be realistic and cognizant of the barriers that women and girls face at almost every stage of their life such as lack of equal education opportunities and technical skills, a lack of recognition of the "soft skills" that aid success, limited mobility, lack of safe, affordable transport, and vulnerability to sexual harassment in public spaces and in the workplace. Lack of affordable and accessible childcare also make it challenging for women to join the workforce.
While these challenges seem daunting, several positive trends can be accelerated. For example, gradual improvements have occurred in literacy and education, notably in the tertiary sector. At the provincial level, the Government of Sindh has passed a landmark policy on home-based work, to be followed by relevant provincial legislations to accord the home based workers the right to access minimum wage, social security and other benefits. The Punjab government is following suit on the same policy. Similarly, the Punjab Maternity Benefits Amendments and the amendment to the Punjab Land Revenue Act signal victories for gender equality that have implications for female labor force participation. The Government of Pakistan's vision 2025 aims to increase women's participation in the workforce to 45 percent.
Gender equality is central to the World Bank Group's own goals of ending extreme poverty and boosting shared prosperity. The World Bank Group Pakistan program includes policy advice, investment financing and technical assistance. The current portfolio is $5 billion. As such, the institution can play a significant role in supporting the government in meeting its gender targets and building on the gains already made. The International Finance Corporation's collaboration with the commercial banking sector to make banking more accessible to women as well as the World Bank's recent investment in comprehensive programs for financial inclusion are just some examples of how we are scaling up our commitment to gender equality.
The World Bank Group is holding itself accountable through a new gender strategy, which sets more ambitious institutional targets, and charts the way for more results-focused and strategic interventions. A key priority for our Pakistan strategy is on removing constraints for more and better jobs for women and closing the gap in access to finance. With our new strategy in place, the World Bank is poised to work closely with counterparts in Pakistan to help increase women's labor force participation by, for example, boosting access to higher quality jobs, providing care services and safe transportation.
From our work in over 100 countries across the world, we know that no society can develop sustainably without transforming the distribution of opportunities, resources and choices for women and men so that they have equal power to shape their own lives and contribute to their families and communities. Walking the talk on gender by removing constraints for more and better jobs for women is simply smart development. The World Bank Group is committed to pursuing this agenda in partnership with our counterparts in Pakistan.
