Helping informal women workers is key to jump-starting recovery

This article originally appeared on FT.com.

Years ago, I visited a rural province in India and met a group of women farmers who were part of what economists call “the informal workforce.” They were the economic backbone of their community. These women had pooled their money and purchased seeds so they could support their families and one another. Their hard work contributed a great deal to their country’s economy—as does the labor of the other 2 billion informal workers worldwide.

These farmers weren’t employed by any company and didn’t earn a regular paycheck. They probably didn’t show up in government labor statistics. When COVID-19 hit, many such informal women workers used their skills to help their communities and countries get through the pandemic. But as is often the case, governments frequently overlooked and undervalued their contributions. Economically, they lost more than nearly anyone. In a 2020 analysis of 10 countries, job losses were two to three times higher among informal workers than those formally employed. And they have no safety net to fall back on—no paid sick leave, no unemployment insurance.

The world now has a big opportunity to do better. If leaders—including the finance ministers participating in this week’s World Bank and International Monetary Fund meetings—put informal women workers at the center of their economic recovery plans, they will repay an enormous debt. What is more, they will also be able to get their economies growing more quickly.

When the women working in fields, markets, and homes around the world lose their livelihoods, of course they and their families suffer. But economies do, too. Informal work accounts for 60% of all global employment. In Africa and India, as many as nine in 10 working women are in informal jobs.

Right now, thanks to US$93 billion mobilized recently by the World Bank’s International Development Association, governments in low-income countries have the opportunity to take decisive action to support these women and jump-start their economies. 

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First, countries should invest in child care. This is just common sense: When their children are safely looked after, more women can return to the workforce or start a new business. All told, the Eurasia Group estimates that expanding access to child care for families who don’t currently have it could increase global gross domestic product by more than US$3 trillion. At the Gates Foundation, we are investing in the World Bank Childcare Incentive Fund, which will help governments fund promising models.

Second, countries should direct financial resources, including cash transfers, to women, many of whose assets were wiped out in the pandemic. To support economic growth, countries need to increase access to affordable credit for women, who often can’t get the financing they need to start and grow businesses. Expanding bank lending and directing funds to collective enterprises like the one I saw in India can turn this story around, by providing liquidity, rebuilding assets, and encouraging growth, especially in the private sector.

Third, countries should use data better to track challenges and progress. To solve a problem, you have to be able to see it. Too often, leaders don’t understand how women are suffering disproportionately and how that affects economies, because that’s not how they break down their data. By consistently disaggregating economic and development data by sex and other key characteristics, countries can gain a fuller picture and ultimately devise more effective policies. In Mexico, information gathered over several years from the financial sector and surveys of citizens allowed leaders to see, and then narrow, gaps in women’s access to financial services.

When Afghan girls desperate to learn are banned from school and pregnant Ukrainian women are stumbling out of bombed maternity hospitals, it is hard to think of anything else. These are grave atrocities. And they are not totally disconnected from the economic neglect of women. When we build a world where those furthest from economic opportunity have an equal chance to thrive and lead, we build a world that’s more peaceful and more resistant to shocks.

As global leaders seek solutions to the mounting financial, health, and security challenges, they must not overlook the informal women workers who hold up their societies in innumerable and often invisible ways. These individuals can be the engine of our global recovery. We must see them. But more than that, we must support them—with action, not just words.