Closing gender gap could add £150 billion to UK economy

Improving parity in the workforce could increase GDP by billions of pounds over the next decade, report finds

Bridging the gender gap in the United Kingdom could increase GDP by billions of pounds over the next decade (andresr)

Taking simple steps to close the gender gap in the UK's workforce could increase GDP by billions of pounds, a study has found.

The report, published by global management consultant firm McKinsey Global Institute (MGI), reveals improving gender parity in work - including workforce participation, hours worked, and sector mix of employment - could realistically add £150 billion in GDP in 2025.

This figure roughly equates to the size of Britain's total annual government expenditure on education, defence, and transport combined.

Meanwhile, if full parity were to be achieved - meaning women were involved in the workforce identically to men — a total of £600 billion of additional GDP could be added to business-as-usual forecasts in 2025.

The report concludes that while the £600 billion is an over-ambitious goal for the next decade, the £150 billion figure can "realistically" be achieved if every UK region matches the pace of the fastest-improving region for gender parity over the past decade.

Increased female participation in the labour force, a shift by women into more productive sectors and more flexible hours are identified as the principle ways the growth can be obtained.

The report states specifically that the UK must see three per cent more women - a total of 840,000 - in the workforce, working hours that allow women to do paid work for as little as 30 minutes more day, and more done to get more women into the most productive sectors and leadership roles.

Vivian Hunt, co-author of the report and a managing partner at McKinsey & Company, told The Independent: "We are trying to be specific enough about how we can bridge the gender gap so that it's something industries and governments actually feel they can do, so we can move on from diagnosing the problem to have company-specific, region-specific ways in which the UK could close the gap.

"We based the target on the best cases of gender parity that we've seen in the UK and what could be achieved if this practice were UK-wide, which brought us to the £150 billion. This is realistic and it's still a very exciting, significant opportunity.

Ms Hunt said one of the most important aims was to encourage companies to introduce flexibility in working hours. She added: "We are encouraging businesses to use techniques on flexibility in work that have already been practiced and proven in the UK.

"Women need enough support around unpaid caring work and domestic respoinsibilty. A woman deciding to become a parent or taking on caring responsibilities is the single biggest interruption in her professional career, which can be helped by allowing just 30 minutes more paid work a day.

"The reality is that more flexible working benefits men and women. It's good for the economy and it's good for all of us if we have better female participating in the economy. Women are 50 per cent of the population and about 40 per cent of UK GDP, so if we could just get women to parity it would be a huge addition to the economy."

Currently women in the UK tend to be concentrated in low-productivity sectors and low-paying occupations and were least represented in high-productivity sectors—including science, technology, engineering, and math (STEM)—and higher-salaried occupations, including skilled trades and managerial and leadership positions, which report the highest densities of skill shortages.

The report states that in order to capture the economic opportunity, government, private-sector organisations, and other groups should take actions to remove direct barriers to women working and create better opportunities.

Earlier this year the UK was ranked 11th out of 18 European countries for gender equality at work, as part of research by Glassdoor that examined the gap between female and male employment rates, female representation on corporate boards and top management and the “cost of motherhood”.