Opinion| Closing the digital gender gap

Heike Harmgart
8 Min Read
Dr Heike Harmgart, EBRD Managing Director for the southern and eastern Mediterranean region

The novel coronavirus (COVID-19) pandemic has radically changed the way that we work. Will But will these changes become permanent? 

It seems likely that this digital evolution is here to stay, whs why it is vital to make sure that women are able to participate on an equal and fair basis. 

In the lead-up to early 2020, we witnessed extensive global travel, a boom in business and the economy, and a record number of women participating in the labour force. 

The pandemic has changed everything. Social distancing has meant the closure of firms, shops, and schools, a rise in working from home, and the appearance of ghost cities. A stable internet connection is now more essential than ever for connecting to the world, accessing education, and working. 

As the world becomes more and more digitally connected, a substantial divide is emerging between women and men in terms of accessing and using the internet. This divide is a major threat to the gains that women have achieved in the labour market. 

The COVID-19 crisis risks putting gender equality on hold and entrenching inequalities, even though women represent 49% of the global workforce. In the Middle East and North Africa (MENA) region, the challenge is greater, with women representing just 21% of the labour force and contributing only 18% to the region’s GDP. 

In addition, women continue to lag behind men in their use of digital technologies, particularly mobile technologies.  

In low and middle income countries, 300 million fewer women than men use mobile internet, a gender gap of 20%.  Even before the pandemic, women in these countries were 8% less likely than men to own a mobile phone.  

This means that women are less likely than men to have access to vital (and basic) services, such as educational content, employment opportunities, medical information, or financial tools such as cash transfers. 

Due to the pandemic, this digital gender divide is expected to worsen, as affordability and lack of digital skills remain some of the key barriers to effective use of the internet, especially in the world’s least-developed economies. 

Women continue to be less well paid than men, even when working from home via the internet. This pay gap, coupled with globalisation, could mean competing with the global labour market, and hence earning even lower wages.

Furthermore, social norms tend to make it harder for women to maintain their position in the labour market during periods of crisis. 

Since the start of the pandemic, school closures and a reduction in childcare services provided by elderly carers have meant that women have taken up a large volume of unpaid care and domestic work. 

In addition, many economies where the EBRD invests have recorded a higher incidence of gender-based violence and harassment, attributed to the heightened stress and financial difficulties experienced during lockdowns.

The creation and preservation of sustainable jobs is a key goal for policymakers. Workers in economies with a greater degree of informal employment have been disproportionately affected by job losses. 

Some sectors, including services such as retail, hospitality and tourism, are key sources of employment for women in particular but have been greatly impacted by the crisis. 

Currently, women entrepreneurs are being negatively affected by the COVID-19 crisis, due to the characteristics of their businesses, their risk preferences and their constrained or non-existent access to finance. 

Women-owned enterprises tend to be smaller and to carry smaller cash reserves than businesses led by men, and this affects their ability to weather the crisis and recover rapidly. 

Moreover, women entrepreneurs do tend to be more risk-averse than their male counterparts, particularly when responding to stressful situations. They also experience relatively limited access to information, professional networks and support, which makes it more costly for them to establish business relationships and accumulate organisational capital. 

The European Bank for Reconstruction and Development’s (EBRD) new Strategic and Capital Framework for 2021-25, which sets out the strategic aspirations of the Bank for that period, includes two key aims that are more relevant than ever: the promotion of equal opportunities, and the acceleration of the digital transition. 

Solutions that support these aims should encompass strengthening skills through training and policy engagement at the sector level. They should also expand access to finance to underserved women entrepreneurs, while accompanying this expansion with mandatory training in the use of digital tools. 

This digital literacy can open new horizons for women. By entering sectors that are traditionally dominated by men, digital literacy can bring work to women at home, especially in conservative societies, thus enabling more women to become an active part of the formal economy.

Accelerating digital transition can be a key enabler for women, and the EBRD is pursuing initiatives in this area. Digital applications and the underlying infrastructure can greatly enhance connectivity and integration. 

For example, through investment in digital infrastructure, modern broadband can be made more affordable, leading to an increase in the number of households and smaller enterprises participating in e-commerce activity. 

The EBRD is also developing solutions based on digitalisation for a range of clients. For example, this includes the roll-out of inclusive digital products for enterprises via local banks as part of the EBRD’s Women in Business programme, and direct support to businesses through the Bank’s Advice for Small Businesses programme.  

A key ingredient for success, over and above affordability and access to the internet, is the development of an ecosystem of apps and services to meet the needs, preferences and capabilities of women. 

A fair digital engagement is required to ensure that women fully participate in economic activities and can build on the gains acquired over the last century.  

The pandemic has magnified digital inequality but it has also shown the adaptability of humankind and the multitude of tools that are available to achieve equality. 

In a crisis of this scale, collective efforts are needed to address the serious digital exclusion and inequality that women increasingly experience. Governments, policymakers and regulators in the digital arena, multilateral development institutions, civil society and the private sector all have a responsibility to put digital inclusion at the centre of ‘building back better’. 

Heike Harmgart is the Managing Director for southern and eastern Mediterranean region at European Bank for Reconstruction and Development (EBRD) .

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