Gender Equality and Poverty

• Women's unpaid care work and lower earnings put them at high risks of poverty compared to men.

• Labour markets disadvantage women due to the persistence of social norms.

• Progress requires changing policies and social expectations so men share care responsibilities equally with women.

Updated •
December 15, 2023
Overview

Income Poverty and Gender

Across the world, women face higher rates of poverty than men. They are more likely to lack the income needed to cover their basic needs and tend to end up poor in old age more often than men. This systemic inequality stems from women's greater responsibility for unpaid care work and the barriers they face in the labour market. As a result, women’s independence and well-being suffers. To alleviate this inequality and female poverty, new policies and norms concerning earning, caregiving and gender seem necessary.

Income Poverty and Gender

Income Poverty and Gender

It is challenging to measure poverty, due to the complex nature of poverty measures. When we discuss poverty, we often focus on income poverty — either absolute income poverty or relative income poverty — although there is debate about whether these are in fact different and whether more complex measures are more appropriate. Absolute poverty focuses more on the lowest income needed to secure the barest of living standards — to survive. The relative definition is based on contemporary norms and standards and, therefore, understands that the nature of poverty will be different in different societies and will change as society itself changes. Poverty, by this definition, can be where resources are so seriously below those commanded by the average household that the poor are excluded from ordinary customs and activities of society. Often, households are deemed poor if they have an income of 50 or 60 per cent of the median income.

Women are more likely to be income-poor than men, with the average poverty rate for women across the OECD being 12.3 per cent, whereas it is 10.9 per cent for men. Women<span class="span"><span id=hint class="box-source">face</span><div class="popover">Source:<br><br><div>Organisation for Economic Co-operation and Development. Society at a glance 2019.</div></div></span>a higher risk of poverty than men in all OECD countries, except Denmark, Finland and Greece, with the largest gender poverty gaps observed in Estonia, Latvia and Korea, where the poverty rates among females are 4 to 6 percentage points higher than men. Moreover, lone-parent families in the OECD, usually headed by women, are<span class="span"><span id=hint class="box-source">more likely</span><div class="popover">Source:<br><br><div>Organisation for Economic Co-operation and Development. Family Database: Child Poverty.</div></div></span>to be in poverty (31.9%) than two-parent households, although the gap is small in Denmark, and particularly wide in Korea, Japan, New Zealand and Canada. 

Whilst one-earner households have the highest risk of poverty, there is also<span class="span"><span id=hint class="box-source">evidence</span><div class="popover">Source:<br><br><div>Peña-Casas, R., Ghailani, D. and Vanhercke, B. In-work poverty in Europe: A study of national policies. European Commission, 2019.</div></div></span>that two-earner low-wage households are not necessarily protected from poverty either. This indicates the importance of both mothers and fathers earning, and both parents earning a decent wage to reduce the poverty risk. Older women are also at<span class="span"><span id=hint class="box-source">greater risk of poverty</span><div class="popover">Source:<br><br><div>Organisation for Economic Co-operation and Development. Family Database: Child Poverty.</div></div></span>than older men, with an OECD average of 15.1% of women in poverty compared to 10.1% of men and 11.3% for the overall population, although there is no gender gap in Chile and little gender difference in Spain.

OVERVIEW

Hidden Poverty: the Issue of Poverty Measurements

Statistics on poverty can be deceptive. This is mostly due to poverty being measured using households as a standard. These measures mask the difficult realities of unequal distribution within people’s homes. This ’hidden poverty’ disproportionately impacts women, who often lack financial control.

Hidden Poverty: the Issue of Poverty Measurements

Hidden Poverty: the Issue of Poverty Measurements

One issue that has been raised regarding measuring income poverty, especially when understanding gender differences, is that poverty is often<span class="span"><span id=hint class="box-source">measured</span><div class="popover">Source:<br><br><div>Karagiannaki, E. and Burchardt, T. Intra-household inequality and adult material deprivation in Europe. Centre for Analysis of Social Exclusion, 2020.</div><br><br><div>—</div><div>Piccoli, L. Female poverty and intrahousehold inequality in transition economies. IZA World of Labor, 2023.</div></div></span>at the household rather than individual level. Thus, official measures overlook who earns the income and how this is distributed within the household: a household may have an income above the poverty line, but one or more people in it may be living in ‘hidden poverty’ because resources are not shared equally between all members of the household.

Research shows that it is women who are more likely to experience ‘hidden poverty’ either due to financial control or because women are more often responsible for managing the budget in low-income families and may put their partner and children first. Also, there may exist a gender imbalance between earnings in couples whereby individual earnings — usually women’s — are not enough alone to avoid poverty. This also means women are<span class="span"><span id=hint class="box-source">more likely</span><div class="popover">Source:<br><br><div>Karagiannaki, E. and Burchardt, T. Intra-household inequality and adult material deprivation in Europe. Centre for Analysis of Social Exclusion, 2020.</div><br><br><div>—</div><div>Piccoli, L. Female poverty and intrahousehold inequality in transition economies. IZA World of Labor, 2023.</div></div></span>to be financially dependent on their partners. Therefore, conventional measures of poverty may miss these gender inequalities in income within households.

OVERVIEW

Women and Unpaid Care Work

Because women generally have to endure most responsibilities for unpaid care, they are often subject to more risks of poverty. Women spend more time on unpaid domestic work, caring for children, and meeting their family’s needs, than on securing their own financial security. This battle of priorities limits their participation in paid labour and reduces their earnings. Caregiving remains undervalued and excluded from social benefits tied to employment in most cases.

Women and Unpaid Care Work

Women and Unpaid Care Work

The reason behind higher female poverty rates is ultimately that women are more likely to be carers and generally spend more time than men in unpaid care and housework, with employed women spending about 2.3 hours daily on housework, whereas employed men spend around 1.6 hours. The gender gap is<span class="span"><span id=hint class="box-source">highest</span><div class="popover">Source:<br><br><div>European Institute for Gender Inequality. Gender Equality Index 2021: Health. European Union, 2021.</div></div></span>for couples with children. Thus, the gendered assumption of the male breadwinner model of the family in which men mainly undertake paid work and women’s main responsibility is to focus on family care prevails globally. This matters as it impacts women’s financial independence, with implications for access to paid work, how this translates into gender inequality in the labour market, how much women earn and ultimately women’s risk of poverty.

Unpaid care and housework are not directly compensated economically, despite often being time-consuming and potentially cost-reducing within the household. For example, preparing meals completely from basic ingredients rather than relying on pre-packaged, ready-to-eat foods or restaurant takeout can take more hands-on time but save money. Similarly, doing domestic work like cleaning or childcare yourself rather than paying for house cleaning or babysitting services requires more unpaid time and effort but avoids those expenses. The undervaluing of care is also<span class="span"><span id=hint class="box-source">reflected</span><div class="popover">Source:<br><br><div>Barron, D. and West, E. The financial costs of caring in the British labour market: Is there a wage penalty for workers in caring occupations?. British Journal of Industrial Relations, 2013.</div><br><br><div>—</div><div>England, P., Budig, M. and Folbre, N. Wages of Virtue: The Relative Pay of Care Work. Social Problems, 2002.</div></div></span>in how employment as a carer is often low-paid relative to other occupations. In addition, social citizenship rights — in other words, the right to welfare benefits — are often tied to participation in paid work rather than unpaid care work, meaning women are less able to access benefits due to their caring responsibilities.

OVERVIEW

Gender Inequality in the Labour Market

Outdated assumptions that women should be the ones providing care for their children drive systemic inequalities in the labour market. The labour market often adjusts to this by providing reduced and flexible work options for mothers, leading to lower pay and increased risk of poverty. These dynamics widen the gender pay gap universally and impose a ‘motherhood penalty’.

Gender Inequality in the Labour Market

Gender Inequality in the Labour Market

That women are assumed to be carers means that once they have children, they are more likely than men either to withdraw from paid work — at least when their children are young — or to work part-time. Invariably, the majority of men are<span class="span"><span id=hint class="box-source">more likely</span><div class="popover">Source:<br><br><div>Organisation for Economic Co-operation and Development. Family Database: Usual working hours per week by gender.</div></div></span>to work long hours (over 40 hours a week), especially when they have young children. In Hungary, Latvia, Lithuania, Poland, Slovenia, Bulgaria, Malta and Romania, over 90% of men work 40 hours or more, although fewer than 50% of men work 40 hours or more in Denmark, Belgium, France, Finland and Norway. Part-time work not only translates into lower wages but often means lower levels of employment protection and promotion. At the same time, gender segregation is apparent within the labour market. 

Vertical segregation means men are more likely to be in higher-paid occupations than women, such as managerial positions. Horizontal segregation means women are more likely to be employed in different sectors than men. These are generally lower paid and are more likely to be linked to assumed ‘female roles’ such as jobs in the service sector including nursing or childcare. It is plausible that employers have preconceived assumptions that women are more likely to be carers and, thus, may put less effort into the job or be less available than men. This discrimination may also<span class="span"><span id=hint class="box-source">influence</span><div class="popover">Source:<br><br><div>Padavic, I., Ely, R. J. and Reid, E. M. Explaining the Persistence of Gender Inequality: The Work–family Narrative as a Social Defense against the 24/7 Work Culture. Administrative Science Quarterly, 2020.</div><br><br><div>—</div><div>Schaerer, M. et al. On the trajectory of discrimination: A meta-analysis and forecasting survey capturing 44 years of field experiments on gender and hiring decisions. Organizational Behavior and Human Decision Processes, 2023.</div></div></span>hiring practices and career progression for women in paid work. Thus, globally, women are less likely to earn the same level of wages as men and the gender wage gap is<span class="span"><span id=hint class="box-source">apparent</span><div class="popover">Source:<br><br><div>Organisation for Economic Co-operation and Development. Family Database: Gender pay gaps for full-time workers and earnings differentials by educational attainment.</div></div></span>across the OECD — it is widest in Korea (31.1%), Israel (24.3%), Latvia (22.1%), Japan (19.8%) and Estonia (19.6%), but under 5% in Denmark, Norway, Spain, Columbia, Bulgaria and Belgium. Women also experience a motherhood penalty, with larger gender gaps in earnings for those with children.

OVERVIEW

Solutions to Unpaid Care and Female Poverty

The assumption that women should be solely in charge of childcare confines them to poverty now and in old age. Pension systems fail to address this, and often work on the very assumption that men are their family’s breadwinner and females their caregiver. Countering dependence on partners requires policies supporting mothers’ employment, properly valuing unpaid work and encouraging fathers’ equal participation in care. Only by elevating and sharing unpaid work can women gain financial autonomy and well-being in the long run.

Solutions to Unpaid Care and Female Poverty

Solutions to Unpaid Care and Female Poverty

Compensating Unpaid Care

Limited access to paid work increases the likelihood that women will be in poverty. Low earnings make it difficult for women to save and contribute to state and private pensions, meaning they are also more likely than men to be poor in old age. Moreover, women are also more likely to live longer than men, which contributes to a higher risk of poverty in old age. Pension systems have generally been designed around the assumption that men are the primary earners and women are the primary carers. Men’s pension income is, therefore, expected to cover their wives too. This assumes that men will share their pension income equally with their wives, which is not necessarily the case in reality. Also, pension systems do not actually address the income inequalities women face due to caring responsibilities and, thus, perpetuate this inequality.

There has been a global move towards more individualised pension systems in recent years with increased emphasis on pension income entitlement linked to individual earnings. In theory, this gives more incentive for women to build up their own individual pensions. However, in practice, these pension systems need to be understood in the context of women’s reduced access to paid work due to caring responsibilities. Therefore, the extent to which women are able to build up their own pensions due to broken work histories, lower wages and lengthy leaves needs to be acknowledged. This has resulted in pension ages being pushed back to allow women to work longer, but also to some consideration of how to compensate for caring responsibilities during working life to enable higher pensions in old age. 

One potential way to do this is to subsidise a parent to stay at home with children — potentially over 2 or 3 years — and essentially give support to caregivers. However, these kinds of leaves are not generally successful in combating poverty. Because care is undervalued, they usually attract a low flat rate or percentage of the average wage, with weak employment protection, and usually mean mothers with low-middle incomes and low education are out of paid work for long periods. They often lead to limited re-entry into paid work, and those who do return, do so in low-paid part-time work, exacerbating the motherhood penalty and reinforcing gender divisions of labour.

Other schemes include allowing time spent caring to count towards pension entitlement. This might be by enabling pension entitlements when becoming a mother or when taking parental leave. It might be by reducing the number of years required to build a pension for those with caring responsibilities or by counting years spent caring in the same way as paid work. However, compensating for time spent caring does not overcome the fact that pensions are linked to earnings. Thus, the main way to tackle this issue is to support those with caring responsibilities to access paid work and earn an independent income.

Supporting Mothers into Paid Work: New Solutions, New Challenges

Countries can reduce the impact of caring by supporting mothers into paid work via a mixture of activation policies, protected leaves and financial incentives for second earners to take up employment through available, affordable and quality childcare. 

Protected leave that enables a break from work when a child is very young whilst protecting the mother’s job allows for entry and re-entry into paid work regardless of caring responsibilities. However, unlike the care leaves described above, to be successful, these leaves need to be well-paid, with a high wage<span class="span"><span id=hint class="box-source">replacement rate</span><div class="popover">Source:<br><br><div>Finch, N. Inclusive citizenship and degenderization: A comparison of state support in 22 European countries. Social Policy & Administration, 2021.</div></div></span>(the amount paid during the leave to replace the mother’s lost earnings whilst on leave). For example, the replacement rate is 100% of average earnings in Austria, Estonia, Germany, Luxembourg, Netherlands, Poland, Portugal and Slovenia, but Ireland and the UK only compensate for about a third of the average wage. Leaves also need to be relatively short to ensure that a break from paid work does not mean long periods out of paid work exacerbating the motherhood penalty. Moreover, the leave needs to be followed by quality childcare support that is free and guarantees a full-time childcare place for all pre-schoolers to realistically enable mothers to return to work.

Research<span class="span"><span id=hint class="box-source">shows</span><div class="popover">Source:<br><br><div>Center for Progressive Policy. Women in the labour market: Boosting mothers’ employment and earnings through accessible childcare. 2021.</div></div></span>that women enjoy better living conditions in countries that invest more money in childcare. These countries have more women in paid work and smaller pay gaps between genders. The Nordic countries are leaders in that regard. However, it's not enough to simply have childcare available — it also needs to be affordable. If childcare is too expensive, the financial benefits of women entering the workforce are reduced. This is particularly true for those with a lower level of education, who tend to earn lower wages. Mothers may also be uncertain about the quality of external childcare. This may influence their decision to pursue paid work. Where childcare is expensive and of low quality, informal care arrangements are more common. It most often involves grandparents caring for their grandchildren. To support mothers in taking up paid work, welfare states need to provide childcare guarantees. Such guarantees include the availability of free, full-day care for children of pre-school age, as well as after-school care for school-aged children.

However, childcare is not enough in itself to enable mothers to sustain paid work and to reduce gender inequalities in the labour market. Mothers in paid work often experience a<span class="span"><span id=hint class="box-source">‘double shift’</span><div class="popover">Source:<br><br><div>Hochschild, A. R. The Second Shift: Working Parents and the Revolution at Home. Viking, 1989.</div></div></span>given the gender division of care within the household leading to time poverty, with little time for leisure relative to men and potentially low well-being. Childcare and leaves aimed solely at mothers, therefore, fail to fully tackle the underlying gender division of labour. This means that women reduce their working hours, drop out of paid work entirely or reduce their fertility to compensate for this double burden. In countries where women are not offered the opportunity to reconcile work and family life, they<span class="span"><span id=hint class="box-source">often opt</span><div class="popover">Source:<br><br><div>Doepke, M. et al. The Economics of Fertility: A New Era. Social Science Research Network, 2022.</div></div></span>for lower fertility.

Unless gender inequities in care within the household are addressed, the assumption that women are the main carers will remain. This, in turn, not only means women will continue to be less likely to take up paid work, but also less likely to take up well-paid jobs. To fully incorporate women into paid work would require gender equality in caring — supporting fathers to care — as well as supporting mothers to enter paid work. This requires changes in society at a deep structural and cultural level, relating to social norms and behaviours.

Supporting Fathers in Childcare

Countries can support fathers to undertake childcare by offering paid leave from work with the specific purpose of looking after their children. Leaves aimed solely at mothers, especially if they are long, will have limited success in challenging gender role norms. But leaves for fathers need to be designed in such a way that they will not only encourage fathers to care, but to do so to the same extent as mothers. Leaves which do not do this will be less successful at challenging the assumption that mothers are the main carers and, in turn, at supporting mothers into paid work. 

For example, some countries, such as the UK, have implemented maternity leave that allows a portion of the leave to be shared with fathers, but leaves it up to the family to decide whether the father takes any leave, and if so, how much. Nevertheless, this type of 'transferable leave' is unlikely to be successful in challenging traditional gender roles as it is unlikely that fathers will actually take the leave. This is partly for financial reasons. First, the gender pay gap means fathers are likely to earn more than mothers. It, therefore, becomes more financially advantageous for the mother to take the time off work to care for her children. This is particularly true in cases where the financial benefits attached to the leave do not fully compensate for the loss of earnings. Second, social norms and the persistence of the male ‘breadwinner model’ often discourage fathers from taking extended leave. As a result, these policies, when in place, are still not effective enough to tackle assumed gender roles. Paternity leaves or ‘use it or lose it’ leaves aimed at fathers — whereby fathers are allocated some months or weeks of leave which the family will lose if they do not use it — are more likely to encourage take up.

The USA and New Zealand are the only countries that do not offer any individual paternity leave. Others such as Australia, Chile, Hungary, Turkey, Mexico, Malta and Croatia offer only one week or less, and nine others offer two weeks or less. Belgium, France, Iceland, Japan, Korea, Portugal and Slovakia offer individual leaves of 20 weeks or more. Still, not all of these offer 100% of previous earnings for the whole leave, with Japan<span class="span"><span id=hint class="box-source">leading</span><div class="popover">Source:<br><br><div>Organisation for Economic Co-operation and Development. Family Database: Parental leave systems.</div></div></span>in the number of weeks where previous earnings are fully paid offered to fathers (31.9 weeks) followed by Korea (25.2 weeks), Slovakia (21 weeks) and Luxembourg (19.4 weeks).

Nevertheless, these more generous paternity leaves are still unlikely to tackle gender inequalities surrounding care if mothers are allocated much longer leaves than fathers. To bridge the gap, some suggest the introduction of equality in the length of maternal and paternal leave. Therefore, arguably, individual leave rights for mothers and fathers of similar lengths would be a more concrete step to<span class="span"><span id=hint class="box-source">tackle</span><div class="popover">Source:<br><br><div>Finch, N. Inclusive citizenship and degenderization: A comparison of state support in 22 European countries. Social Policy & Administration, 2021.</div></div></span>the gender division of labour in the household.

Both leaves for mothers and fathers would need to be well, and equally, compensated financially to reduce gender poverty. This would then encourage fathers and mothers to care on an equal basis and, thus, access paid work on an equal basis. This would, in turn, contribute to reducing poverty in families with children, not only by increasing female financial independence through the support of maternal attachment to paid work, but also by giving fathers the opportunity to provide care. This would also highlight the value of care, and challenge the gender role norms within the home and in paid work. Women would be less likely to lose out financially relative to men as both would be earning and caring equally. Ultimately, gender gaps in poverty (i.e., when women are more likely to be in poverty than men) in working and old age would be reduced.

Overview

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