The Cost of Not Educating Girls: $30 Trillion

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World Bank, economic benefits for girls of education

The failure to provide girls with education through secondary school comes at a high cost to their health and well-being—and at a staggering cost to the world economy, to the tune of $15 trillion to $30 trillion in lost earnings and productivity.

That’s the calculation of the World Bank, which in a new study gauges the benefits of education not only in higher wages for women over their lifetimes, but also in areas such as girls not having children as teenagers, lower infant mortality, and girls’ avoidance of violent relationships.

The biggest economic payoff comes in the developing world, where income and school levels are lower and girls and women potentially reap greater benefits, said Quentin Wodon, a lead economist at the World Bank and the lead author of the report.

Many relatively poor nations have already made progress in creating near-universal access to more basic education, at the primary school level, according to the World Bank.

But a much bigger economic and societal upside comes from bringing girls farther along educationally, and giving them access to secondary education, the study finds.

Females with primary education earn between 14 percent and 19 percent more than their peers with no education at all, the study found. But females with secondary education can expect to make nearly twice as much, and those with a college education will benefit almost three times as much as those with no education.

“It’s not enough to complete primary education,” explained Wodon in an interview. “Completing secondary is very important from the policy aspect, [and] the economic cost of not educating girls is very large. It is affecting women in every dimension of their lives.”

Secondary Ed: A Big Hurdle

Wodon and his co-authors draw from a variety of sources to calculate potential gains from improving girls’ access to education. One source is previous World Bank surveys of households and the labor force, and from bank analyses of human capital wealth across 141 countries. The study also relies on publicly available demographic and health surveys from 18 developing countries. Data from the Gallup World Poll, drawn from surveys of individuals in 150 countries, were also used.

The authors rely on a  method known as regression analysis to make statistical associations about the impact of low educational attainment on girls’ development. The researchers control for variables that might have affected their breakdown of individual economic and social benefits for girls.

Overall, the study’s findings are based on research drawn from a total of 114 countries, including 10 from East Asia and the Pacific, 40 from Europe and Central Asia, 21 from Latin America and the Caribbean, and four from the Middle East and the Caribbean.

The World Bank, formed in 1947, funds programs in education, health, anti-poverty, through loans, interest-free credits, and grants. It has placed an emphasis on giving girls access to school, and over the past two years has invested more than $3.2 billion in education projects aimed at helping adolescent girls.

Roughly 90 percent of girls worldwide finish primary school, but only 75 percent complete “lower secondary education”—or nine years of education, the report says.

The specific payoff from completing secondary school comes to girls in a number of ways, say the World Bank researchers.

In addition to increased earning power, with each additional year of secondary education, girls are at lower risks of marrying as children and having a child before the age of 18, by an average of six percentage points. Universal secondary education could also reduce fertility by one-third in 18 developing countries studied in the World Bank’s analysis. Greater education can also lead to increased contraceptive use.

Benefits Beyond a Paycheck

Girls’ ability to make smart decisions about their health care can also increase with education beyond the high school level, as can their ability to avoid HIV/AIDs. It can also boost girls’ psychological well-being and their avoidance of entering violent relationships, the authors say.

The economic losses of not educating girls are measured in lost human capital. The estimate of between $15 trillion and $30 trillion is based on adult women not benefiting from having obtained a secondary education—defined as completing 12 years of school—in their youth, the study says.

The higher dollar total is based on an estimate of the payoff from the population achieving more years of education. The lower one is taken from a scenario in which the benefits are cut by as much as half, if economic growth produced fewer jobs for newly educated women, or if expanded educational benefits resulted in poorer quality education, the authors say.

The economic costs in not educating girls apply to boys, too. But the consequences for girls are especially severe, because of the impact a lack of education has on child marriage, having children early, and other factors, the authors say. And access to secondary education for girls remains lower than for boys in many nations, they point out.

The study, citing Gallup polling data, points out that a higher level of educational attainment in many countries is linked with lower satisfaction with various services—including education, but also health care, water quality, and transportation

This is not necessarily a bad thing, the authors say. It could be a sign of a more demanding consumer, and women not being satisfied with their choices in education or other areas. This could lead them to demand improvements, or make choices that produce competition, the World Bank says.

In many developing countries, the schools provided are government-run, but private schools have also gained traction, Wodon explained. “It’s important to expand public school [access] and recognize the private role,” Wodon said. “Both can play a role.”

And if the education provided is substandard, merely giving girls additional years of school won’t matter, he said. “It’s not only an access issue. It’s an issue of quality.”

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Photo: Rohingya school girls watch teacher day celebrations outside their classroom at a Rohingya Education Center in Klang, Malaysia back in  2015. Vincent Thian/AP-File


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2 thoughts on “The Cost of Not Educating Girls: $30 Trillion

  1. I liked what you said about how educating girls has benefits beyond a paycheck. We’re considering putting our daughter into a private school to make sure she gets the best chance in life. Thank you for the information about how education can boost a psychological well-being and make smart decisions about their own health care.

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