Women are increasingly becoming a significant force in the Canadian economy, yet there is still progress needed to achieve full gender equality. In celebration of International Women’s Day, it’s essential to recognize and appreciate the vital roles women play in driving economic growth in Canada.
Although the Canadian economy has not achieved complete gender equality, notable strides have been made over the past decades. Women’s contributions are enhancing productivity, boosting consumption and investment, and ultimately improving the well-being of Canadians.
Let’s delve into some key insights that highlight the profound impact of women on the Canadian economy.
Women’s Growing Presence in the Workforce
Women’s participation in the Canadian workforce has seen a steady increase over the years. In 1976, only 52.3% of women aged 25 to 54 were active in the labor market. By September 2023, this figure had soared to a record high of 85.7%.
The employment gap between men and women has also narrowed significantly. In the fall of 2023, the employment rate for men aged 25 to 54 was 87.5%, while for women it was 81.7%, a gap of just 5.8 percentage points.
Higher employment rates among women not only enhance their financial independence and reduce poverty risk but also benefit the broader economy. Encouraging underrepresented groups to enter the job market increases labor supply diversity and reduces reliance on expensive social programs.
Women’s Influence on Consumer Spending
Women, who make up more than half of the Canadian population, exert significant economic influence through consumer spending. They are responsible for 75% to 80% of consumer purchases, which equates to about $1.2 trillion in 2023. Women dominate household spending decisions, including home furnishings, vacations, homes, automobiles, and consumer electronics.
Despite many women working outside the home, they still perform the majority of unpaid household tasks. Women in Canada are estimated to do 50% more household work than men, with this unpaid labor valued at nearly $490 billion.
The Gender Pay Gap and Representation in Leadership
Despite the increasing number of women in the workforce, they remain underrepresented in leadership positions. Women hold only 20% of board seats and 24% of top executive roles in Canada. Additionally, women continue to earn less than men, making 87 cents for every dollar earned by men on average.
Although women are graduating from universities at higher rates than men, they still face barriers to economic opportunities, impacting their financial security and well-being.
The Need for More Women Entrepreneurs
Women are also underrepresented among entrepreneurs. In 2023, only 1.2% of women were entrepreneurs compared to the national average of 2.3%. To match the overall entrepreneurship rate, Canada would need 182,000 more women entrepreneurs and 185,000 more to achieve parity with men.
Canada also lags behind the U.S. in terms of female business ownership, with less than 18% of private sector businesses majority-owned by women compared to an estimated 40% in the U.S. Moreover, women-led startups, despite generating 10% more cumulative revenue over five years, receive significantly less venture capital funding.
The Economic Benefits of Gender Equality
Increasing the number of women entrepreneurs would greatly benefit the Canadian economy. In 2023, revenues of women-owned businesses grew about four times faster than the national average. These businesses are also more innovative and tend to prioritize diversity and inclusivity.
This year’s International Women’s Day theme, “Invest in women: accelerate progress,” emphasizes that closing the gender gap is not just a matter of fairness but also smart economics. Full participation of women in the economy could add up to $150 billion to the Canadian economy.
Improving gender equality is crucial for enhancing Canada’s economic prosperity, especially amidst declining productivity. Everyone has a role to play in supporting this progress. By buying from and recommending women-owned businesses, offering mentorship, and advocating for gender equality in hiring, salaries, and leadership, we can all contribute to a more inclusive and prosperous economy.
The Canadian economy thrives when everyone participates, and advancing gender equality benefits us all.
