Closing the Economic Gender Gap

As the founder of an anti-sex trafficking organization, in country after country that I have visited, I have observed a strong correlation between high levels of sex trafficking and unequal economic opportunities for women. This tells me that closing the income gap between men and women will go a long way to help reduce sex trafficking. In the November 26 issue of The Economist, in an article titled, “Closing the Gap,” author Barbara Beck shows the worldwide economic disparities between the genders. Beck cites Kevin Daly of Goldman Sachs who estimates that closing the gap between male and female employment rates would have major implications for the global economy – mainly boosting the United States GDP by as much as 9%, Eurozone’s GDP by 13%, and the Japanese GDP by 16%.

This is no surprise given the fact that women are spenders. The global cosmetic market alone was forecasted by Europemonitor International to exceed $300 billion in 2010. Clearly, the elimination of the economic gender gap would benefit everyone. Women spend money on the 3 P’s - products, people, and other priorities. Studies show that women are more likely to invest their paycheck on improving health, education, and infrastructure. Based on these variables, shouldn’t putting more dollars in the pockets of women not only increase the GDP but also improve the social economic state of the economy? This would be an ideal scenario, but narrowing the gap in economic disparity between men and women still seems beyond reach.

According the World Economic Forum, in countries like Turkey, South Africa, Malta, Thailand, and even the United States, opportunities are scarce for women. The United States ranks high in the proportion of women who participate in the economy but lags in the proportion of women at higher levels. This is commonly known as the “glass ceiling.” In contrast, economic opportunities are plentiful for women in Nordic countries such as Sweden, Denmark and Norway. Notably, sex-trafficking in the Nordic countries is among the lowest in the world. In the Nordic countries, policies, both economical and political, work hand in hand to prevent women and children from being commoditized. This is not the case for Thailand, South Africa, or even the United States—countries where sex-trafficking thrives.

This past year, for the first time ever, the United States Department of State included the U.S. in its annual Trafficking in Person’s Report. This is a good reminder that we in the U.S are not immune to the issue of sex trafficking. In fact, virtually every global study of human trafficking cites the United States as a prime destination for trafficked sex slaves. The U.S. will soon have to face the fact that sex-trafficking is not something that just happens overseas. According to Harvard researcher Siddharth Kara, sex-trafficking was a $38 billion industry in 2010, globally.

Although research about the correlation between economic opportunities for women and sex-trafficking is scant, it is easy to conclude that giving women more economic opportunities as well as spending power will increase consumption in legitimate sectors and spur economic growth. Economic parity for women seems to be a win-win for everyone; however, with limited investment into their education and training globally, we have a long way to go. According to the United Nations, two thirds of women are illiterate among the 774 million illiterate adults in the world. Perhaps recognizing the fact that gender income disparity perpetuates sex-trafficking is a start to addressing this issue through a more targeted approach.

- Diana Mao