Progress towards greater gender equality has been hesitant and halting over the past five years and the Covid-19 pandemic now risks sending it into reverse. Our analysis shows that women’s jobs are 1.8 times more vulnerable to this crisis than men’s jobs: Women make up 39% of global employment but account for 54% of overall job losses as of May 2020. At the same time, the burden of unpaid care, which has risen in the pandemic, falls disproportionately on women.

This backwards move is not just a blow to women and societal progress but also to the economy and business. If no action is taken to counter the regressive effects, we estimate that global GDP growth could be $1 trillion lower in 2030 than it would be if women’s unemployment simply tracked that of men in each sector. Conversely, taking action now to advance gender equality could add $13 trillion to global GDP in 2030, compared with no action. A middle path — taking action only after the crisis has subsided — would boost the economy but reduce the potential opportunity by more than $5 trillion.

Beyond the economic impact, business leaders have a strong interest in furthering gender equality during this crisis. McKinsey research has found that gender diversity is a key to financial success: Companies in the top quartile for gender diversity on executive teams were 25% more likely to have above-average profitability than companies in the fourth quartile. Moreover, companies now pulling back on diversity and inclusion may be placing themselves at a disadvantage by limiting their access to talent, diverse skills, leadership styles, and perspectives.

Reversing the regressive trend will require, among things, investment in education, family planning, maternal mortality prevention, digital inclusion, and unpaid care work. We estimate that incremental public, private, or household annual spending on these five areas would need to rise 20 to 30% in 2025 above the “business as usual” levels, or a total of $1.5 trillion to $2.0 trillion. By comparison, the economic benefits of narrowing gender gaps are six to eight times higher than the social spending required, we estimate. As we discuss below, investment is just the start.

The Covid Setback Follows a Period of Scant Progress.

Our estimates of the economics of gender parity date back to the McKinsey Global Institute’s (MGI’s) Power of Parity work in 2015, which analyzed 15 gender-equality indicators across four categories: equality in work, essential services and enablers of economic opportunity, legal protection and political voice, and physical security and autonomy. Using these indicators, MGI established a strong link between gender equality in society and gender equality in work — and has shown that the latter is not achievable without the former.

Despite growing awareness of and support for greater gender equality, tangible progress toward equality in work and society stagnated in the five years between 2014 and 2019. Some indicators did improve, such as maternal mortality, the share of women in professional and technical jobs, and political representation. Overall, however, gender equality in work continued to lag behind gender equality in society. The level of female participation in the labor force has not budged — it sits at about two-thirds that of men — although there are regional and country variations.

Now, with Covid-19, women have borne the brunt of the economic impact. Women’s employment is dropping faster than average, even accounting for the fact that women and men work in different sectors. The nature of work remains significantly gender specific, with women and men tending to cluster in different occupations. This shapes the gender implications of the pandemic: Our analysis shows that globally female jobs are 19% more at risk than male ones simply because women are disproportionately represented in sectors negatively affected by the Covid-19 crisis, such as accommodation and food service.

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