Gender, Economics, and the Cost of Not Measuring What Matters
- Melina Olmo
- Mar 9
- 7 min read
Latin America's Most Underutilized Economic Asset
There is an asset that does not appear on Latin America's fiscal balance sheets. It is not traded on any stock exchange, it does not feature in IMF projections, and it rarely surfaces in monetary policy speeches. Yet its underutilization costs the region between 4% and 15% of GDP, according to the Inter-American Development Bank (IDB/BID).
That asset is the full participation of women in the economy.
The conversation about gender in Latin America and the Caribbean has lived too long in the territory of social justice. But a paradigm shift is underway — one that finance ministries, central banks, and investment funds are beginning to decode with growing urgency: the economic exclusion of women is not a values problem. It is a structural inefficiency with measurable negative externalities.
What the Numbers Reveal — and What They Conceal
According to the International Labour Organization (ILO/OIT), female labor force participation in the region stood at 52.1% in 2024, compared to 74.3% for men. But the gap is not only one of participation — it is one of quality.
ECLAC/CEPAL documents that:
78.1% of employed women work in low-productivity sectors
1 in 4 women (25.3%) has no income of her own — nearly triple the male rate of 9.7%
Closing the gender gap could generate $2.6 trillion in annual GDP growth (World Bank)
"When women gain access to income, they reinvest up to 90% back into their families and communities — compared to just 30–40% among men."
In the United States, Latinas working full-time earn 57 cents for every dollar earned by a non-Hispanic white man — a gap that accumulates to approximately $1.2 million in lost earnings over a forty-year career.
The Invisible Economy — Satellite Accounts and the GDP That Doesn't Exist
The Problem With How We Measure GDP
The United Nations System of National Accounts — the framework used to calculate GDP globally — was designed to record market transactions only. Unpaid care work, which sustains the entire productive economy, simply does not exist in that equation.
Several countries in Latin America have begun constructing satellite accounts for unpaid work. Ecuador was among the first — and the results were striking: if unpaid care work were included in GDP, it would rank as the country's third most important economic sector, behind only oil and banana exports.
The Scale of What Goes Uncounted
According to UN Women, the annual global contribution of unpaid care work is valued at $10 trillion — more than the entire global technology industry. ECLAC/CEPAL documents that, where measured, it represents between 15.9% and 27.6% of GDP, with women accounting for 74.5% of that total.
What is invisible is not financed. What is invisible is not regulated. What is invisible does not enter into public policy decisions.
Rosanna Torres, president of the Center for New Economy, frames it this way:
The numbers allow us to show how much labor participation declines, how much income goes ungenerated, how much tax revenue never reaches government, and how that limits the capacity to fund other public services. — Rosanna Torres
The Opportunity Cost — What the Region Is Choosing Not to Produce
An economy that systematically excludes half of its potential labor force is operating under a self-imposed supply constraint that no monetary policy can compensate for.
Women in Latin America dedicate 3.2 times more time to unpaid care work than men.
In Ecuador, a woman may devote up to 40% of her additional weekly time exclusively to care activities — the equivalent of a second part-time job, every week, with no salary, no social security, and no pension. The opportunity cost is direct: continuing education not completed, technical training not acquired, professional trajectories cut short. As researchers and practitioners in the region have documented, there are women who, because they have children, elderly parents, or relatives with disabilities in their care, cannot enter the formal labor market because no support structure exists to make it possible.
Nirlia de Jesus, Chief Operating Officer of Epting, LLC, with over twenty years of experience across the public and private sectors, frames the question that transforms this diagnosis into an economic imperative
How much is it costing us to view gender equity the wrong way? — Nirlia de Jesus
That is not a rhetorical question. According to the IDB/BID, barriers to female entrepreneurship in Latin America could be generating losses of up to 9% of GDP. According to ECLAC/CEPAL projections, while a slight reduction in labor informality and gender gaps may occur in 2025 and 2026, both indicators will remain at structurally elevated levels.
When the System Requires the Abuser's Permission
Even when women want and are able to participate in the formal economy, the system imposes entry frictions never demanded of men. Verónica Artola, former official of the Central Bank of Ecuador, documented that across all income quintiles, women received lower loan amounts and fewer transactions than men with identical solvency indicators.
I remember women who said: 'I would like to have access to credit to start my business' — and they couldn't, because to access a loan, if you are a married woman, you need your husband's signature.— Verónica Artola
In Ecuador, women access up to 20% less credit than men — not because they are less creditworthy, but because the credit evaluation system was designed with a structural bias that automation tends to reproduce at scale.
According to the IDB/BID, crime and violence — including gender-based violence — cost the region 3.4% of GDP annually. Globally, gender-based violence represents a cost of approximately $1.5 trillion per year.
Financial Technology, Algorithms, and the Problem of Biased Data
The fintech revolution promises to correct this market failure by converting digital transaction histories into a new form of collateral. Platforms such as Block's Cash App in the U.S. and Yape in Peru are already building transactional credit layers in predominantly informal economies.
When Algorithms Inherit Human Bias
But technology does not solve the problem if it replicates the biases it purports to eliminate. Research from the IDB and World Bank documents a concrete technical risk: many behavioral variables correlate with structural realities — neighborhood stability, income volatility from care cycles, labor informality — that serve as proxies for gender without explicitly being so.
Key questions any automated credit system must answer:
Are error rates consistent across demographic groups?
Does the model interpret income volatility caused by care work as real risk — or structural noise?
Is the algorithm auditable and contestable by the individual?
Is there regulatory oversight for differentiated impact?
Data sovereignty — real control over one's digital financial identity — begins as a technical problem and can rise to the level of a fundamental economic right.
The Capital Gap Is a Routing Problem, Not a Scarcity Problem
Although 1 in 3 small businesses in Latin America is led by women, they receive only 5% of available venture capital (Latin American Venture Capital Association). In the U.S.:
Latina entrepreneurs receive only 39% of the loan amounts they request, vs. 67% for white men
Just 0.1% of venture capital reaches Black and Latina founders
Startups founded by Latinas obtained less than 1% of venture capital in 2022
Nearly 1,700 STEM-sector companies led by women in Latin America are currently seeking investment (IDB Innovation Lab)
The capital exists. It is a routing problem: allocation systems are calibrated to recognize a narrow set of signals that have historically correlated with the profile of the male, urban founder.
Susan Otim-Neal, Executive Coach at Sincerity Speaks Consulting, adds:
Investing in women's leadership is not charity — it is one of the highest-return economic strategies available. — Susan Otim-Neal
Organizations with diverse leadership are 35% more likely to financially outperform their competitors.
Optimizing for the Wrong Metric
Heather Ingram, author of Applied Flow: Stop Burnout. Be Awesome., adds an organizational dimension that completes the argument:
A culture that measures performance by visibility rather than by actual results is optimizing for the wrong metric. Systems that reward signaling over productivity end up retaining those who signal best — not necessarily those who produce best.— Heather Ingram
The implication is structural: when evaluation systems are designed around visibility signals rather than real output, they systematically filter out high performers who lack access to those signals — disproportionately women, and disproportionately women of color.
Circulation, Not Drain — The Human Capital That Models Don't See
Torres challenges the dominant narrative of brain drain as net loss:
We typically look at the exodus and not the return. In many cases, migration is cyclical. The risk of only counting departures is that we end up designing retention policies when what we may actually need are connection policies.— Rosanna Torres
Educated women are frequently the economic glue of that circulation — maintaining active ties between markets, sustaining extended families, and rebuilding social capital when formal structures collapse.
The Gender Dividend Already Exists — We Are Simply Deciding Whether to Collect It
The problem is not a lack of talent, economic activity, or entrepreneurship. The systems of measurement, resource allocation, and merit evaluation were designed with an implicit constraint — they assumed that half the population would participate under conditions of full economic autonomy. That assumption was never met.
According to the World Economic Forum, at the current pace, achieving gender equity will take more than 120 years — not as a social projection, but as a projection of accumulated loss in productivity, human capital, and economic growth.
The gender dividend is neither a future promise nor a pending redistributive transfer. It is already being collected — in every central bank where an economist connected gender policy to monetary policy and the data proved her right.
The question is not whether the dividend exists. The question is who chooses to ignore it — and how much that decision costs everyone else.
Share this article and continue the conversation about identity and equity on LinkedIn @CulturaDiplomatica
© 2026 Gender, Economics, and the Cost of Not Measuring What Matters. All rights reserved.
Comments