OECD: Reducing gender inequality would bring economic benefits to Estonia

A recent study by the Organisation for Economic Cooperation and Development shows that due to persistent gender differences in Estonian society, the country is missing out on a substantial boost to economic growth that could be unleashed if men and women had the same engagement and chances in the labour market.

The biggest potential for economic growth lies in reducing the professional gaps between men and women in the labour market and in a more equal distribution of unpaid domestic and care work, according to the report.

While the gender gap in labour force participation is small, the analysis shows that Estonian women are still less likely to reach top positions in their careers, and career breaks due to having children contribute to a narrowing but still significant gender pay gap.

Female employment in Estonia higher than the OECD average

If Estonia fully closed its gender gap in labour force participation by 2050, it could expect a boost of 2.3 per cent of additional GDP per capita by that year. Closing the gender gap in working hours could lead to 1.9 per cent of additional GDP per capita in 2050. 

In addition, a reduction in the occupational segregation of women and men and in the gender productivity gap could bring Estonia potential GDP per capita growth of around 9.63 per cent by 2050.

Women working. The image is illustrative. Photo by CoWomen on Unsplash.
Women working. The image is illustrative. Photo by CoWomen on Unsplash.

Employment growth among women in Estonia has been strong in recent years. The female employment rate of 72 per cent in Estonia is well above the OECD average of 61 per cent, and the employment gender gap in favour of men was at three percentage points in 2021.

Female employment rates are higher than among men among older workers, of ages 55-64, due to a mix of economic and health factors. Also, Estonian women generally work full-time: at 13 per cent the part-time employment rate in Estonia is about half the OECD average.

According to the authors of the report, the gender gap being wider than the OECD average in Estonia is also somewhat explained by the more traditional attitudes of the Estonian population towards gender roles in comparison with OECD countries. In addition, women in Estonia continue to shoulder the bulk of unpaid work in and around the house.

To enhance gender equality in labour market outcomes, it is critical to foster a more equal use of leave entitlements among fathers and mothers. Future policy reform could go further by extending the duration of paternity leave or introducing a “father quota” – a non-transferable period of parental leave that is reserved for fathers who take time off to care for children.

Important to embed gender equality throughout the curriculum

In addition, the report recommends a greater focus on services rather than subsidies to support families. In the context of pay inequality and the glass ceiling, the report recommends the introduction of wage transparency measures to improve women’s bargaining power.

Gender pay gap. Illustration by kting on Openclipart.

According to the report, it would be important that school staff and educational materials do not perpetuate traditional gender norms. To help achieve this, systematic pre and in-service training on gender equality for teachers at all levels of education as well as career counsellors and youth workers can help, as they can directly influence young people’s career choices. It is also important to embed gender equality throughout the curriculum, including in specific school subjects, such as civic education, to avoid conscious and unconscious bias.

To ensure that the improved participation of male and female students in information and communication technology activities translates into more girls choosing ICT careers, one could consider more systematically adopting a gender lens throughout the curriculum, for instance by increasing pupils’ and students’ exposure to female role models working in the respective field.

The analysis, titled “The Economic Case for More Gender Equality in Estonia,” was compiled by the OECD together with the Estonian social ministry.

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