Chapter

Chapter 8B. Pakistan

Editor(s):
Kalpana Kochhar, Sonali Jain-Chandra, and Monique Newiak
Published Date:
February 2017
Share
  • ShareShare
Show Summary Details
Author(s)
Ferhan Salman

Women make up half of Pakistan’s population, but their contribution to household income is far below its potential. Addressing the issue of gender inequality will continue to be a gradual process because its roots lie to a large extent in Pakistan’s culture. Nonetheless, the potential gains from greater inclusion of women in the economy are large: closing the gender gap in Pakistan could boost GDP by about 30 percent (Cuberes and Teignier 2016; Figure 8.2).

Figure 8.2.GDP Losses Due to Economic Gender Gaps in Selected Countries

(Percent of GDP)1

Source: Estimates by Cuberes and Teignier 2016.

1 Losses are estimated for a particular year for each country and can thus be interpreted as a one-off increase in GDP if gender gaps were to be removed.

Pakistan has made significant progress in promoting gender equality (Figure 8.3). And female labor force participation has increased by about 10 percentage points since 1990. But there remains ample scope for further progress: Pakistan’s female labor force participation rate in 2012 remained low at 24 percent, compared with 32 percent for South Asia and 69 percent in low-income countries (World Bank 2014a).

Figure 8.3.Pakistan’s Labor Force Participation Rates

(Percent)

Historically, women’s labor force participation has been lower than men’s (Figure 8.3), and women account for most unpaid work—64 percent of female employment is in unpaid family work, double the south Asia average. They also face significant wage differentials of 18 percent vis-à-vis their male colleagues.

Pakistan ranks second-to-last in the World Economic Forum’s Global Gender Gap Index.1 The index examines the gap between men and women in four categories: (1) economic participation and opportunity (labor for participation, wages, senior managerial, and technical positions); (2) educational attainment (literacy and educational enrollment); (3) health and survival (sex ratio at birth and healthy life expectancy); and (4) political empowerment (parliament seats, ministers, and length of heads of states). The gender gap in Pakistan is particularly stark in economic opportunities and participation, education, and health (Figure 8.4).

Figure 8.4.Pakistan’s Global Gender Gap Rankings

(Out of 142 countries)

There is a particularly large gap in Pakistan’s government and public service sector. The share of female legislators, senior officials, and managers is only 3 percent of the total, compared with a world average of 29 percent. However, female representation in the Pakistan National Assembly has increased (due to a quota), in line with the increasing world trend—outperforming the world average and the south Asian countries (Figure 8.5).

Figure 8.5.Women in Parliaments by Region

(Percent of total seats)

Sources: World Bank, World Development Indicators database; and IMF staff calculations.

Gender gaps in education have been declining in Pakistan, and the ratio of girls to boys enrolled in primary and secondary education is 82 percent (Figure 8.6). However, there is room for improvement, as Pakistan still remains well below the low-income country average of 93 percent.

Figure 8.6.Pakistan’s Gender Gap in Primary and Secondary Education

(Ratio of girls’ to boys’ enrollment; percent)

Sources: World Bank, World Development Indicators database; and IMF staff calculations.

Income, education, marital status, household size, and being the head of a household are good predictors of female labor force participation (IMF 2016, 33–34). In Pakistani families with higher household income and large household size, female labor participation declines in both urban and rural areas. Women with higher levels of education are more likely to participate in the labor force in urban areas but not in rural areas. In rural areas, married women are less likely to work outside the home, but if they are the head of a household, that likelihood increases. Having a higher level of education significantly increases women’s participation in the labor force in both urban and rural areas (Sen 2001). However, the impact is more pronounced in urban areas compared with rural areas. In rural areas, women who have less than a high school education are more likely to stay out of labor force.

Policy Recommendations

An integrated range of revenue, expenditure, and legal measures could be used to promote greater female labor force participation in Pakistan, with significant prospective growth and development implications (Sen 2001). Comprehensive policies can be effective in boosting women’s economic participation (Revenga and Shetty 2012; Aguirre and others 2012; Duflo 2012). Reducing government debt and deficits can free up resources for higher infrastructure spending (Elborgh-Woytek and others 2013)) and higher investment in education. And business climate reforms will help advance financial inclusion for women.

Among expenditure measures, increased social spending under the Benazir Income Support Program provides women unconditional cash transfers, which do not require any prior action by the recipient. The transfers will promote continued female school attendance through conditional cash transfers (World Bank 2011, Section C). Budgetary resources could be allocated to provide access to comprehensive, affordable, and high-quality daycare services (Jaumotte 2003), which would free up time women now spend caring for children and the elderly, and thus facilitate female labor force participation (Gong, Breunig, and King 2010; Kalb 2009; Antonopoulos and Kim 2011). In addition, publicly financed parental leave schemes, parity in paternity and maternity leave, and flexible work arrangements can also complement policies to balance family and work responsibilities (Jaumotte 2003; Aguirre and others 2012; World Bank 2012). Infrastructure spending on rural access to clean water and transportation could also reduce the time women spend on domestic tasks and facilitate their access to markets (Koolwal and van de Walle 2013).

Impediments to women’s access to finance could be removed to help to raise the productivity of enterprises owned and managed by women. Pakistani women are entitled to obtain bank loans and other forms of credit, and a number of credit institutions target women. However, their access is limited by their inability to provide the required collateral.2 To raise the productivity of enterprises owned and managed by women, access to finance should be improved and training and support networks among female entrepreneurs should be developed (OECD 2012; World Bank 2011; Blackden and Hallward-Driemeier 2013). Swift operationalization of a credit bureau also would be crucial.

Efforts to mitigate resource restrictions can also increase female labor force participation in Pakistan. Finding opportunities to strengthening female inheritance rights on immoveable property can enhance economic opportunity for women.

Finally, establishing quotas for senior positions could help boost female labor force participation. In both private and public sectors, targeted searches for female candidates for senior positions can provide opportunities for and acceptance of women in positions of leadership (Barsh and Yee 2012).

References

    Aguirre, D., L.Hoteit, C.Rupp, and K.Sabbagh. 2012. Empowering the Third Billion. Women and the World of Work in 2012.Booz and Company, New York.

    Antonopoulos, R., and K.Kim. 2011. “Public Job Creation Programs: the Economic Benefits of Investing in Social Care. Case Studies in South Africa and the United States.Working Paper 671. Levy Economics Institute of Bard College, Annandale-on-Hudson, New York.

    Barsh, J., and L.Yee. 2012. “Unlocking the Full Potential of Women at Work.McKinsey & Company, New York.

    Blackden, M., and M.Hallward-Driemeier. 2013. “Ready to Bloom?Finance & Development50 (2): 1619.

    Cuberes, David, and MarcTeignier. 2014. “Gender Inequality and Economic Growth: A Critical Review.Journal of International Development26 (2): 26076.

    Cuberes, David, and MarcTeignier. 2016. “Aggregate Effects of Gender Gaps in the Labor Market: A Quantitative Estimate.Journal of Human Capital10 (1): 132.

    Duflo, E.2012. “Women Empowerment and Economic Development.Journal of Economic Literature50 (4): 105179.

    Elborgh-Woytek, Katrin, MoniqueNewiak, KalpanaKochhar, StefaniaFabrizio, KangniKpodar, PhilippeWingender, BenedictClements, and GertSchwartz. 2013. “Women, Work, and the Economy: Macroeconomic Gains from Gender Equity.IMF Staff Discussion Note 13/10. International Monetary Fund, Washington.

    Gong, X., R.Breunig, and A.King. 2010. “How Responsive Is Female Labour Supply to Child Care Costs? New Australian Estimates.IZA Discussion Paper 5119. Institute for the Study of Labor, Bonn.

    Gonzales, C., S.Jain-Chandra, K.Kochhar, and M.Newiak. 2015. “Fair Play: More Equal Laws Boost Female Labor Force Participation.IMF Staff Discussion Note 15/02. International Monetary Fund, Washington.

    Jaumotte, F.2003. “Labour Force Participation of Women. Empirical Evidence on the Role of Policy and Other Determinants in OECD Countries.OECD Economic Studies 37. Organisation for Economic Co-operation and Development, Paris.

    Kalb, G.2009. “Children, Labour Supply and Child Care: Challenges for Empirical Analysis.Australian Economic Review42 (3): 27699.

    Koolwal, G., and D.van de Walle. 2013. “Access to Water, Women’s Work, and Child Outcomes.Economic Development and Cultural Change61 (2): 369405.

    Organisation for Economic Co-operation and Development (OECD). 2012. Closing the Gender Gap: Act Now:Paris: Organisation for Economic Co-operation and Development.

    Organisation for Economic Co-operation and Development (OECD). 2014. Social Institutions and Gender Index.Paris: Organisation for Economic Co-operation and Development.

    Pakistan Bureau of Statistics. Pakistan Social & Living Standards Measurement and Household Integrated Economic Surveys (2011/2012).Islamabad.

    Revenga, A., and S.Shetty. 2012. “Empowering Women Is Smart Economics.Finance & Development49 (1): 4043.

    Salman, Ferhan. 2016. “Macroeconomic Gains from Raising Female Labor Force Participation in Pakistan.Pakistan: Selected Issues. IMF Country Report No. 16/1. International Monetary Fund, Washington.

    Sen, A.2001. “Many Faces of Gender Inequality.Frontline18 (22): 117.

    World Bank. 2011. World Development Report 2012, Gender Equality and Development.Washington: World Bank.

    World Bank. 2012. World Development Report 2013, Jobs.World Bank, Washington.

    World Bank. 2014a. World Bank Development Indicators.World Bank, Washington.

    World Bank. 2014b. Women, Business and the Law.World Bank, Washington.

    World Economic Forum. 2014. Global Gender Gap Report.World Economic Forum: Cologny.

A version of this analysis was previously published as Salman 2016.

The Global Gender Gap Index was first introduced by the World Economic Forum in 2006 as a framework for capturing the magnitude of gender-based disparities and tracking their progress (World Economic Forum 2014).

Section 18 of the Constitution grants all citizens the right to conduct any lawful trade or business, and the government reported that all of the services of the formal banking sector are available to women.

    Other Resources Citing This Publication