Women in work: how companies in Chile reduced wage inequalities

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

New data released in the Global Gender Gap Report shows strong results from three years of public-private collaboration to further close the economic gender gap in Chile.

The impact.

The World Economic Forum Gender Gap Accelerator programme has significantly improved the professional prospects of women in Chile. By bringing together leaders from the private and public sectors, the Forum has been influential in enhancing the quality of work for more than 130,000 local women – the equivalent of 7% of salaried employees in Chile’s private sector.

Data indicates that the Forum’s three-year accelerator programme in Chile has effectively promoted female representation in member companies, which include Accenture, Cargill, IBM, Invest Chile, LatAm Airlines, Microsoft, Nestlé, PwC, SAP, Salmon Chile, Siemens and Unilever.

On average, these companies report that 41% of staff members are women – almost 10 percentage points above the national average, which stood at 31.7% in January 2019. More importantly, these employers have reduced gender wage inequalities by 37.5% between 2016 and 2019. Put differently, men hired by the group of 180 companies receive, on average, 5.6% more remuneration per hour of work, a gap that is considerably lower than the national average, where men earn almost 18% more wages, on average, per hour worked. Continued collaboration intends to reduce this gap even further.

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What’s the challenge?

It is unlikely that global gender parity will be achieved in our lifetime.

Since 2006, the Forum has been measuring gender gaps in countries around the world in the annual Global Gender Gap Report. The most challenging gender gap is the economic dimension which, according to the latest data, will take 137 years to close. Although the economic opportunity gap has slightly reduced, progress has been hit hard by the COVID-19 pandemic, especially in terms of participation of women in the labour force, where the gender gap slightly reversed.

Today, proportionately fewer women than men are participating in the workforce, which means fewer women end up in leadership positions, and women often earn less than their male colleagues.

Our approach.

The Forum has helped to establish groups of accelerators around the world focused on closing the economic gender gap. In Latin America and the Caribbean, accelerators have been convened in Argentina, Chile, Colombia, Costa Rica, Dominican Republic, and Panama in partnership with the InterAmerican Development Bank. Egypt and Jordan host Closing the Gender Gap Accelerators in the Middle East and North Africa region and during the Jobs Reset Summit 2021, Kazakhstan reinforced its commitment to equality in the workforce and announced the launch of a Global Gender Gap Accelerator.

In these locations, CEOs and ministers are working together over a three-year time frame on policies that help to further close the economic gender gaps in their countries. The specific aims are to increase the number of women in leadership positions, reduce and then close the gender pay gap, increase women’s participation in the labour force, and hardwire gender parity into the future of work.

In Chile, the InterAmerican Development Bank and the Ministry of Women have played a significant role in reducing the economic gender gap.

With the exception of large service businesses, companies in all industries have made progress in promoting gender equality and reducing gender pay gaps. Especially noteworthy are the large manufacturing companies that, with reductions of almost 90%, have practically eliminated their gender inequalities when it comes to salary levels. Service SMEs have also made significant progress and reduced wage inequalities by 80% over three years. Today, this sector has a wage gap that favours men by only 1.2%.

How can you get involved?

The Chile Accelerator has completed its initial three-year pilot programme and is currently assessing the viability of future projects. Our goal is to build a global network comprising a total of 15 countries accelerating gender parity by 2025 and engage with 15,000 private sector companies.

If you are a business in one of the Closing the Gender Gap Accelerator countries, you can join the local membership base and contribute to driving impact. As part of a local accelerator, you will assess economic gender gaps within your company and implement policies to help change them.

If you are a business or government in a country where the Forum does not currently have a Closing the Gender Gap Accelerator, please contact us to explore opportunities for setting one up.