As political and economic leaders met for the World Economic Forum in Davos, new research reveals that the world’s 22 richest men have more combined wealth than all 325 million women in Africa. Economic inequality is out of control – and it’s unbelievably sexist.
The economic gender gap across Europe and the world
Our broken economies are fuelling the inequality crisis. They enable a wealthy elite, mostly men, to accumulate huge fortunes at the expense of ordinary people, especially poor women and girls. Oxfam’s new report, ‘Time to Care’, shows that the world’s 2,153 billionaires currently own more wealth than the 4.6 billion people who make up 60% of the planet’s population. Meanwhile, women and girls around the world put in 12.5 billion hours of unpaid care work every single day. They cook, they clean, and they care for children, the sick, and the elderly. This is a huge contribution of at least $10.8 trillion a year to the global economy, more than three times the size of the global tech industry.
And yet, it’s all for free.
Women also make up most of the paid ‘care workforce’ – jobs such as nursery workers, domestic workers, and care assistants, which are often poorly paid. Both unpaid and underpaid care work is vital to keep the wheels of our economies turning. It is driven mostly by women, often at the expense of their chances to get an education, earn a decent living and have a say in how our societies are run. Meanwhile, men own 50% more wealth than women and predominate in positions of political and economic power, while women don’t get a seat at the table.
Although income inequality in the EU is lower than in many other regions, Europe has nowhere near achieved economic nor gender equality yet. In 2017, the top 20% of the population in the European Union received five times the disposable income of the bottom 20%. And to this day, women are still less likely to be in paid work and to progress in their career, and continue to earn less than men. The gender gap in unpaid care work also persists across the Europe. OECD data shows that women in Italy and Ireland spend almost three hours more than men per day doing unpaid work, mainly care work, and Portugal almost four hours more. On average, women still spend more time than men on unpaid care work in every single European country.
The roots of a sexist economic system
The enormous divide between rich and poor and between men and women is based on a flawed and sexist economic system. At the top of the economic pyramid, extreme wealth is accumulated, while at the bottom, nearly half the world is trying to survive on $5.50 a day or less.
One of the main reasons for this staggering inequality is the collapse in taxation of big companies and rich individuals because of falling tax rates and deliberate tax dodging. Our governments are massively under-taxing the wealthiest and failing to collect revenues that should be invested in universal public services, such as schools and hospitals. This would benefit the world’s women and girls, lifting some of the care work off their shoulders by giving all families access to public services. Evidence also shows that cuts to public services hurt women the most as they are more likely to lose their jobs as well as social benefits and protections. Research by the European Women’s Lobby finds that single mothers and single female pensioners face the biggest cumulative losses from public spending cuts in Europe.
The rising gender and economic inequality is also linked to the deterioration of working conditions and weakening of collective bargaining. Women in the care workforce are particularly vulnerable to and afflicted by poor regulation, lack of social protection, salary decreases and exploitation. Care workers are paid significantly less than workers in other sectors with similar levels of skill and qualifications, and are often subject to improper working conditions. Many paid care workers lack opportunities for collective bargaining, which could help them improve their situation.
Perhaps the biggest problem is the way in which inequality feeds itself through political capture of power. Wealthy elites have the power to influence policies and write the rules of the game in their favour, while the poor and marginalised lack opportunities to be heard and to level the playing field. This representation gap is also sexist, not least due to the burdens of unpaid care work which hinder women’s participation in social, economic and political life.
The road towards a human economy
Although rising inequality is alarming, solutions do exist. Firstly, all governments – not least the European Union and its member states – must seriously and urgently tackle corporate tax avoidance and introduce more progressive taxation to ensure a fair redistribution of wealth. The EU has a key role to play in stopping the race to the bottom on corporate tax, promoting a fair global tax system, and tackling harmful tax practices both within and outside the EU. Over the past years, the European Parliament and the European Commission have tried to introduce several measures to improve taxation systems, such as public country-by-country reporting which would greatly improve tax transparency. However, many of these efforts have been stifled by opposition from member state governments.
Improving tax systems at national and global levels will allow governments to increase investments in public services, care systems social protection. Globally, getting the richest 1% to pay just 0.5% extra tax on their wealth over the next 10 years would create enough money to pay for 117m jobs in education, health and elderly care. Governments also need to ensure paid parental leave schemes and childcare services, which reduce the amount of time spent by women on unpaid care work and promote shared responsibility of care between men and women. In this regard, the European Directive on the work-life balance for parents and carers of 2019 is a step in the right direction and should serve as inspiration for EU member states.
European leaders also need to address deteriorating labour conditions, secure decent living wages for all, tackle the gender pay gap and strengthen the political representation of workers – especially women – by supporting human rights’ and women’s associations and assuring their participation in decision-making processes. Finally, sexist beliefs and norms need to be challenged through advertisement, public communication and legislation. As long as care work is considered the sole responsibility of women, the inequality crisis will not be resolved.
These are some of the crucial steps on the road towards a more human economy – an economy that works for people regardless of their gender and benefits everyone, not just a fortunate few. An essential prerequisite of a human economy is to address the role of unpaid and underpaid care work. Only by fundamentally changing how this work is distributed and valued can we build fairer and more equal societies, in Europe and beyond, and empower women across the world to lift themselves out of poverty.