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How Covid-19 disproportionately affected women-led businesses

Rachel Toku-Appiah
By Rachel Toku-Appiah

Director, Program Advocacy and Communications, Bill and Melinda Gates Foundation, Africa

Posted on Friday, 25 June 2021 18:14

The spread of the coronavirus disease (COVID-19), in Accra
Women wearing face masks chat at the Nima market as Ghana lifts partial lockdown amid the spread of the coronavirus disease (COVID-19), in Accra, Ghana April 20, 2020. REUTERS/Francis Kokoroko

While many parts of the world are experiencing a decline in birth rates, in Africa we see a very different picture. By 2030, a fifth of the world’s population will be from the continent.

As millions of young people join the labour market every year, governments are struggling to create employment to meet the demand for jobs. Countries like South Africa, for example, are reporting that three-quarters of all youth are now unemployed.

Women disproportionately affected

These numbers are staggering and reminiscent of the worst economic downturns of the past. However, unlike many previous recessions, this crisis has a distinctively female face.

The “she-cession” triggered by Covid-19 is pushing women out of the labour market – often with little or no prospect of return. By some calculations, women’s jobs are 1.8 times more vulnerable to this crisis than men’s jobs. In Ethiopia and Uganda, the gender gap in employment has now widened by at least 14 percentage points. In South Africa, it is estimated that women have suffered two-thirds of the job losses due to the pandemic.

One important reason for this impact on women is that the measures put in place to contain the virus significantly increased the burden of unpaid care. This type of work is disproportionately carried out by women and born from stereotypes that have dictated women’s place in society for centuries. Some of these social norms, which relegate women to family roles and domestic chores, mean they have had to take a step back to care for their children as measures like school closures came into effect.

Women’s employment rates are dropping faster than average. And with women making up 50% or more of the workforce in many African countries, this presents us with both a huge risk and opportunity. We can either take action and change our future for the better or confine our continent to decades more growth-restricting inequality.

2021 must be a year of action for gender equality. In bringing together leaders from across society, the Generation Equality Forum taking place later this month is the opportunity for our leaders to match the urgency of this moment and deliver for women and girls.

Entrepreneurship

One area where we can be encouraged is African entrepreneurship. Sub-Saharan Africa has the world’s highest rate of women entrepreneurs. Having grown up in Botswana, a global leader in women-owned businesses, this isn’t news to me. Whether it is designing, textile manufacturing, food processing, wellness products or business services, women leaders are inspiring new generations and showing us what is possible.

The fantastic achievement in African entrepreneurship points to the vast potential that we can draw on to help our continent grow and be more prosperous.

But all is not as it first may seem. During the pandemic, women-owned businesses have been more likely to close and less likely to reopen. Although some women have a real desire to open their own business, many are driven by necessity.

They need income to help care for their family and run their household, so a home-based or flexible venture helps them juggle these priorities. Women-owned businesses also consistently earn less than their men-led counterparts. Female entrepreneurs across sub-Saharan Africa continue to make lower profits than men (34 % less on average). While African women make up almost 58% of the continent’s self-employed population, they are granted less funding, receive less training, mentorship, start-up advice, and fewer opportunities to scale.

If we could encourage and incentivise women’s businesses, we can help them grow and accelerate their recovery from the financial impact of Covid-19.

Imagine what the continent would look like if empowering women to succeed in business was the status quo. It would mean more than half of the continent’s potential workforce in jobs, contributing to their communities and the economy. Empowering women is simply smart economics. In Niger, for instance, the World Bank predicts that GDP would be over 25 per cent higher if gender inequality were reduced.

Bottom line

To really bring about lasting and transformative change, however, we need to change entrenched views about women’s role in society. We must start to see women as having autonomy over their health, their education and their futures. We know that with greater access to information about reproductive health, contraceptives and services, women and girls are more likely to stay in school, join the workforce and keep their jobs.

As a woman with a background in science and technology, I am used to being a minority in the system. It doesn’t matter where you look, there are not many women in STEM to provide leadership, mentorship and inspiration. In countries like Nigeria and Kenya, only one in four women are working in the field. We know that when women are involved in decision making, they achieve better outcomes for everyone in science and research.

This is the future we want to build. Women are an untapped and underutilised talent pool. We all make better decisions when we’re working with diverse teams, bringing a range of lived experiences and perspectives to the table.

We must tackle gender equality now so that women are able to live full, healthy and productive lives. It is absolutely essential to our national – and global – recovery plans. Only through concerted action, led by parents, teachers and leaders at every level, will we ensure the girls of the future do not inherit this inequality.

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