33. The potential of digitalisation for women’s economic empowerment in MENA countries

Gaëlle Ferrant
Mariarosa Lunati

Legal reforms promoting gender equality and women’s rights in the Middle East and North Africa (MENA) region have an important momentum. Over the past five years, the pace of reform has picked up, without being disrupted by the COVID-19 crisis. A high number of legal changes was recorded in 2017-22 to close the wide gap between national legal frameworks and international standards (Figure 33.1). Since 2017, 14 economies of the region (Algeria, Bahrain, Djibouti, Iraq, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Palestinian Authority, Saudi Arabia, Tunisia and the United Arab Emirates) have enacted laws and regulations aimed at facilitating women’s participation and rights in the labour market. This represents 52 reforms in five years, including 36 since the onset of the pandemic (World Bank, 2022[1]).

Reforms include measures to lift restrictions on women’s employment and mobility (e.g. Oman and Saudi Arabia), mandate equal remuneration (e.g. Iraq), prohibit gender-based discrimination in financial services (e.g. Jordan and Egypt), promote equal retirement benefits (e.g. Palestinian Authority) and protect women from violence (e.g. Algeria, Djibouti, Morocco and Tunisia), including sexual harassment in employment (e.g. Kuwait and Lebanon). New policy initiatives also encompass reforms to family law and social protection systems, challenging traditional gender roles. For example, in 2019 Bahrain adopted reforms allowing women to be head of the household in the same way as men, while in 2021 the United Arab Emirates introduced five days of paid parental leave as an individual entitlement, giving female and male employees an equal right to paid leave for the birth of a child – a novelty in the region.

Implementation efforts and enforcement mechanisms have helped transform reforms into effective measures for women’s economic empowerment. This is notably the case for women’s entrepreneurship. All legal frameworks across the region now provide men and women with equal rights to sign a contract, register a business and open a bank account. In parallel, several initiatives have been implemented to support women-led businesses. For example, in 2017, Egypt included a gender provision in its investment law, prohibiting discrimination in investment and supporting small investors, who are typically women. In 2018, Tunisia established the National Chamber of Women Entrepreneurs (CNFCE) Academy, which trains women business-owners on topics such as financial management, marketing and labour law. In Jordan, the 2018-20 National Financial Inclusion Strategy focused on reducing the gender gap in finance and the Central Bank’s Maya Declaration aimed at closing the gender gap in bank account ownership.

However, discriminatory provisions towards women’s economic rights remain. These include restricted access to assets, which results from the difficulty of reforming laws governing property ownership and inheritance: no MENA country provides male and female surviving spouses, or daughters and sons, with equal inheritance rights; and 13 MENA economies (Algeria, Egypt, Iran, Iraq, Kuwait, Lebanon, Libya, Oman, Palestinian Authority, Qatar, Syria, Tunisia and Yemen) do not prohibit gender discrimination in access to credit. Moreover, only Saudi Arabia and the United Arab Emirates do not restrict women’s access to work – allowing them to work at night, in jobs in the same way as men, while at the same time mandating equal remuneration for work of equal value. Finally, 12 MENA economies (Bahrain, Egypt, Jordan, Kuwait, Lebanon, Palestinian Authority, Oman, Qatar, Saudi Arabia, Tunisia, the United Arab Emirates and Yemen) do not comply with ILO Convention No.183, which stipulates the right of women to at least 14 weeks of maternity leave (World Bank, 2022[1]).

Moreover, there are cases where implementation and enforcement are hindered by discriminatory attitudes. In the period 2017-20, according to the results of the World Value Survey, the majority of respondents (both women and men) in the region declared that men should have a privileged access to employment in case of job scarcity (89% in Egypt, 81% in Jordan, 78% in Iraq, 70% in Iran, 65% in Tunisia and 62% in Lebanon) and that pre-school children suffer with working mothers (84% in Jordan, 77% in Egypt, 71% in Tunisia, 64% in Iraq, 63% in Lebanon and 55% in Iran). Similarly, 56% of respondents in Egypt and Jordan, 50% in Iran, 48% in Iraq, 44% in Tunisia and 34% in Lebanon believed that it is a problem if a woman earns more than her husband. Although attitudes towards women’s economic empowerment in MENA countries are evolving among certain population groups, such as the most educated, MENA remains the only region in the world where younger generations of men do not hold more liberal views than older generations when it comes to gender equality (Haerpfer et al., 2021[2]). In addition, women’s restricted access to justice combined with their lack of awareness of their rights and laws which protect them, highly restricts their effective application.

The enormous talent pool that women represent with their ever-higher levels of education goes largely untapped in the MENA region, although with variation across countries, resulting in significant missed opportunities for economic development. Women’s education rates have increased dramatically in the region – a factor usually leading to higher employment levels. In 2020, the regional female enrolment rate in tertiary education (43%) exceeded the male rate (39%), matching the world average (World Bank, n.d.[3]).

However, the regional female labour force participation has risen very slowly, remaining vulnerable to economic shocks. It reached 20.4%percentage in 2017 – just a 1 percentage point increase in 15 years – before backtracking during the COVID-19 crisis. In 2021, only 18.4% of women aged 15-64 were working or actively looking for a job in the MENA region, which is the lowest rate in the world. Young women (15-24 years old) encounter particular difficulties in accessing employment in the region: they are on average more than twice as likely as young men to be not in education, employment or training (NEET) (World Bank, n.d.[3]).

Important differences exist across sub-regions, with Arab Gulf countries (Bahrain, Kuwait, Oman, the United Arab Emirates, Saudi Arabia, and Qatar) standing out, due to female migrant workers coming from other regions. For example, female labour force participation increased by more than 15 percentage points in Saudi Arabia over the past decade, reaching 31% in 2021. In some countries such as Bahrain (42.4%), the United Arab Emirates (46.5%) and Kuwait (47.4%) the female labour force participation rate caught up with the global average (46.2%), and Qatar, at 57.2% (World Bank, n.d.[3]), is getting closer to the OECD average (64.8%), whilst exceeding Türkiye (37.3%), Mexico (48.3%), Italy (55.4%), Costa Rica (56.6%) and Chile (54%) (OECD, 2022[4]). Yet, differences in participation rates are influenced by differences in measurement and composition of the labour force. Indeed, there has been phenomenally rapid growth of the expatriate population in the Arab Gulf region in the past decade, and a significant proportion of the labour force now consists of non-citizens. For example, Qatari nationals make up only 10-15% of the entire labour force (Buttorff, Welborne and al-Lawati, 2018[5]).

Gender gaps are also observed in entrepreneurship, increasing with entrepreneurial stages (Chapters 28 and 29). Launching a new business appears as a relevant opportunity for female income-generating activities across the region: over 40% of the female population consulted expressed entrepreneurial intentions in Egypt, Kuwait, Morocco, Oman and Qatar (Figure 33.2, Panel A). However, relatively few new ventures created by women in the region survive to become established businesses, demonstrating the difficulties women entrepreneurs face to consolidate their business (Figure 33.2, Panel D). In Oman for example, while 18% of women set up new businesses in 2020, only 5% led an early-stage business and less than 2% an established one (Figure 33.2, Panels C and D). There is significant cross-regional variation: in 2020, the proportion of women nascent entrepreneurs was similar to the proportion of men in Saudi Arabia (14% compared to 13.8%), but four times lower in Egypt (3% compared to 11.2%) (Figure 33.2, Panel B).

Gender disparities in entrepreneurship lead to men being twice to six times more likely than women to be running an established business in MENA economies (GEM, 2021[6]). Lack of financing was considered as the main obstacle to start a business by 37% of women entrepreneurs in Tunisia, 44% in Jordan, 48% in Palestinian Authority and 51% in Egypt; and as an impediment to growth by 22% of women in Tunisia, 36% in Palestinian Authority, 40% in Jordan and 42% in Egypt (UNIDO, 2017[7]).

The digital transformation of MENA economies can open new avenues for reducing women’s unemployment and underemployment in the region, as highlighted by experts at three regional dialogues held in 2021 and 2022 by the MENA-OECD Women’s Economic Empowerment Forum (WEEF) (OECD, 2021[8]; OECD, 2021[9]; OECD, 2022[10]). The booming digital economy creates new types and modes of work and entrepreneurship, while digital technologies push material and conceptual boundaries (Chapter 13). Digitalisation can contribute to lift traditional impediments to female labour market integration in the region – such as legal and cultural barriers, travel restrictions, job scarcity, skills mismatch, lack of information on job vacancies, discriminatory practices in recruitment and selection processes, family responsibilities, as well as restricted access to financial resources, networks and mentoring.

With an expected annual growth of 30% during the 2021-23 period, the MENA digital economy is a promising job-creating sector for both highly and low skilled workers. Demand is growing for data analysts and scientists, artificial intelligence (AI) and machine learning specialists, digital marketing and strategy specialists, business development professionals, information security analysts, software and applications developers, to cite a few. In addition, digital platforms connect employees and employers around the world, providing MENA women with greater access to foreign labour markets. For example, an increasing number of MENA women work in call-centres from the region for Europe-based firms, but also as webmasters or web designers. Similarly, online payment and e-commerce innovations facilitate trade across borders, enabling MENA women entrepreneurs to reach new markets – as long as connectivity infrastructures are available to them. Estimates indicate that the regional share of women in professional and technical jobs will double by 2030 through digitisation, online platforms and entrepreneurship (Assi and Marcati, 2020[11]).

Yet, advances in AI, dropping ICT prices, and increased internet use accelerate the use of automation. The World Economic Forum (2019[12]) estimated that 41% of all work activities are susceptible to be automated in Kuwait, 46% in Bahrain and Saudi Arabia, 47% in the United Arab Emirates, 49% in Egypt, 50% in Morocco and 52% in Qatar. In this context, policy makers need to advance efforts to build a gender-inclusive digital recovery, also considering gender differences when it comes to skills, exposure and effects of digitalisation and AI (Chapter 13):

  • Lack of skills, rural divides, high technology costs and a changing nature of the labour market are some of the aspects policy needs to consider.

  • Ensuring an inclusive digital recovery also calls for engagement with the private sector and civil society, given the need to establish working conditions that consider the risks that “the future of work” pose to women’s economic empowerment in the region.

  • In addition, inclusiveness implies adopting an intersectional approach towards women’s economic empowerment, considering women in their diversity – e.g. in terms of levels of education and income, age, disability, migration status or place of residence.

Addressing the digital gender and rural digital divides is key for making digitalisation an engine of equality in the region. Internet use rates are higher for men (48%) than for women (39%) in the region (ITU, 2020[13]) and, despite improvements, connectivity is patchy across and within MENA countries. For example, poor Internet and network coverage are significant challenges for 28% of MENA women entrepreneurs surveyed in 2019-20 by UNIDO (forthcoming[14]). Rural areas are particularly affected by reduced network coverage, with only 44% of rural areas in Arab States benefiting from 4G mobile network coverage, compared to 76% of urban areas (ITU, 2020[13]).

The digital sector has demanding technical requirements. Coding, programming, analysing big data, AI and the Internet of Things require specific skills. In that respect, ICT seemed difficult to use for 52% of MENA women entrepreneurs surveyed by UNIDO in 2019-20, and 12% considered the lack of digital literacy as a principal impediment to use technologies in their business activities. This rose to 17% for women entrepreneurs having lower levels of education, compared to 4% for those who graduated from university. Affordability is the most significant barrier: 41% of women entrepreneurs declared ICT costs as the main reason for not using technologies in their business activities (Figure 33.3).

A growing proportion of MENA women is well-positioned to seize employment and business opportunities brought by digitalisation. Decades of investments in female education led to a rapid rise in their educational attainment – including in Information and Communication Technologies (ICT) and Science, Technology, Engineering and Mathematics (STEM). Between 34% and 57% of STEM graduates in the MENA region are women – higher than the OECD average of 31% (UNESCO, 2019[15]). Moreover, the OECD Programme for International Student Assessment (PISA) results suggest that MENA girls outperform boys in two essential digital skills: multiple source text reading and metacognition (i.e. the ability to evaluate the credibility of sources). In addition, girls do not lack confidence in their capacities and have positive attitudes towards competition, which is critical to engage in tech careers.

Yet, similarly to what happens in OECD countries (Chapter 9), few MENA women – even among the best female performers in mathematics and science – pursue their careers in STEM occupations. In Lebanon for example, among students with high scores in mathematics or science, over 46% of boys but only 26% of girls reported that they wanted to be engaged in science and engineering professions (OECD, 2019[16]). MENA stakeholders need to ensure that enhanced women’s digital skills fully contribute to a sustained and inclusive recovery, investing in relevant education and especially labour policies to create opportunities for women’s integration in the digital labour market, as employees and entrepreneurs.

MENA women’s adaptability to meet the new needs of the labour market and their chance to secure employment will depend on their upskilling and reskilling opportunities. Policy should support their skills development, including digital skills, to make them benefit from automation as well as transit to new jobs. Reshaping school curriculums and widening access to digital training is key in this process. Lifelong digital learning is key to mitigate the negative externalities of digitalisation on no computer-savvy women.

Thanks to their dematerialised aspect, digital talent platforms, online government services or remote learning can provide women with a greater access to the resources and skills needed to find a job. For instance, the “She is for a Digital Future” training programme, launched by the Egyptian Ministry of Planning and Economic Development in partnership with CISCO and UNDP, provided online training on digital skills and financial inclusion to 2 000 women. In the same way, the IDEA App tool developed by the social start-up Bridge for Billions in partnership with UNIDO reached over 300 entrepreneurs across MENA countries, including one-third of women, and provides them with online entrepreneurial coaching and mentoring to develop bankable business plans.

By formalising rules in management processes, human resources technologies (e.g. AI supporting recruitment, worker management and evaluation) can contribute to more efficient matching in the labour market and reduced gender-based discrimination at work. This might be particularly relevant in the MENA region, where online talent platforms and use of AI in human resources management are widespread. In 2019, for example, the number of LinkedIn users reached 8 445 515 in the MENA region, with 29% of women (Assi and Marcati, 2020[11]).

Digital technologies facilitate teleworking and the realisation of entrepreneurial projects operating from home allowing for greater flexibility in working hours and place – despite existing risks for gender equality and work-life balance (Chapter 26). This offers opportunities to better combine paid work and family responsibilities: one-fifth of women entrepreneur considered family responsibilities as a main obstacle to start their business in the region (UNIDO, 2017[7]). It also allows to overcome mobility restrictions, both of which play a pivotal role in women’s income-generating activities in MENA countries.

Evidence shows an increased use of teleworking since the COVID-19 pandemic in the region. In Morocco for example, while teleworking was rare before the pandemic, 56% of managers worked remotely during the first lockdown (Elakry and Guechati, 2021[17]). Interestingly, almost twice as many Moroccan female workers (24%) as male workers (13%) have regularly adopted telework (Haut-Commissariat au Plan, 2021[18]). Similarly, 48% of Palestinian women were regularly teleworking after the lockdown, compared to 34% of men (UN Women, 2021[19]). Policy has a key role to play as regards a gender-sensitive regulation of telework and other forms of flexible working arrangements.

Online tools can improve women entrepreneurs’ access to business registration, digital financial services, skills and networks.

  • Business registration. To facilitate the formalisation of SMEs and businesses operating from home, Morocco issued a law to introduce the auto-entrepreneur status in 2015. Recently, the dematerialisation of the registration procedure and the option to pay taxes and social contributions online has increased the accessibility of the status. This is particularly relevant for entrepreneurial activities run by women, which are usually smaller than those run by men. Indeed, Moroccan women account for 36% of auto-entrepreneurs, while running 23% of enterprises (Haut-Comissariat au Plan, 2021[20]). Women are also disproportionally affected by the relative high cost of, and lack of information on, administrative registration procedures due to a limited access to support network and financial resources.

  • Access to finance. The digitalisation of financial products and services, and the proliferation of online learning tools, can contribute to strengthen women’s financial inclusion by allowing for more cost-effective financial education provision and facilitating women entrepreneurs’ access to finance – as far as they are connected to the Internet.

  • Investment. Digital businesses can be less capital- and labour-intensive than traditional industries, thus requiring less office space. In MENA countries, where women face impediments in accessing capital or in leasing and owning property, dispensing with the need for expensive real estate could make a considerable difference to women entrepreneurs (UNIDO, 2017[7]).

Digitalisation is also creating new forms of informality, raising concerns about working conditions, job and income security, access to social protection and collective bargaining rights. Legal loopholes regarding teleworking or use of AI weaken regulatory frameworks. For example, around the world, most laws prohibiting gender-based discrimination in employment hold employers liable for discrimination and rely on employees’ reports but ignore AI vendors and developers’ accountability. Digital technologies – including AI – may also reinforce existing gender stereotypes. Thanks to increased awareness, programmers have been actively engaged in correcting gender bias to make AI gender neutral.

MENA countries need to step up their efforts to adopt adequate regulations to reconcile digitalisation and work quality, including:

  • Promoting safe telework to enable women to choose where, when and how they work. Labour regulation and collective agreements on teleworking rights should address gender biases. Provisions can guarantee inclusive collective bargaining rights, anti-discrimination, career advancement opportunities, ability to revert to office based-working, data privacy and cyber-security. They can also specify employers’ liabilities for occupational safety and health, working schedules, and indicate who bears the cost of teleworking equipment. Moreover, promoting care infrastructure would mitigate the detrimental effects of telework on MENA women’s work-life balance (see above and Chapter 26). In order to achieve gender-neutral teleworking in the MENA region, labour regulations should be accompanied by policies promoting the availability, accessibility and affordability of care infrastructure and services for children.

  • Ensuring adequate legislation and regulation are in place to guarantee women platform workers’ rights, clarify their classification and improve their working conditions. Policy actions encompass extending collective bargaining rights, introducing a minimum wage, regulating working time, improving occupational safety and strengthening social protection.

  • Preventing AI-driven gender discrimination to give MENA women and men equal access to employment opportunities. This includes non-discrimination and data protection laws to protect job seekers from discrimination; transparency and accountability mechanisms; awareness-raising of human resources professionals; assessing risks of recruitment procedures; issuing ethical guidelines on the development and use of AI; ensuring transparency in AI applications; monitoring AI systems; and conducting gender impact assessments.

  • Combatting cyber violence would make digital a safer tool of women’s economic empowerment, reducing women’s reluctance to use it to develop their skills, find a job or reach new clients. Measures include laws penalising cyber violence, prevention and education campaigns, victims’ protection arrangements and specialised units for the investigation and prosecution of online violence. Importantly, governments need to recognise that cyber violence disproportionately affects women and girls and adopt a gender lens to design and implement policies (Chapters 6 and 7).


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