Due to tighter monetary policy aided by lower international commodity prices, the global inflation rate is on the decline, from 8.7% in 2022 to 6.9% in 2023 and 5.8% in 2024. According to the IMF, it is still more than double the pre-pandemic worldwide average of 3.5%. Emerging and developing economies saw higher inflation, with some experiencing staggering rates of 25% or higher. Soaring food and fuel prices, in particular, have pushed more than 70 million people into poverty worldwide, according to the UN Development Programme.
Pink Tax on Beauty Products
Moreover, the already-high prices of products that women often buy (the so-called “pink tax”) are rising even higher. According to Macrobond, the analytics and data company established in Sweden, the consumer price index of beauty products in Mexico and France rose by about 13%, while in South Korea, the index rose by 10%. An inflation analysis in the United Kingdom showed that price hikes were higher on women’s shoes, blouses, socks, and other products than those aimed at men. Women’s formal shoes have seen a price increase of 75% in 2021, while those for men increased by only 14%. Feminine-hygiene product prices have also soared worldwide, according to Bloomberg.
Women worldwide tend to do the majority of household shopping and spend a larger share of their incomes on food than men. Therefore, they are confronted with the burden of choosing how to adapt their weekly purchases. Women also play a significant role in farming, agricultural production, and other activities across food systems. According to the Food and Agriculture Organisation of the United Nations, in 2021, 31.9% of women faced moderate or severe food insecurity compared to 27.6% of men.
Gender Gap and Low-Payed Industries
At the same time, sectors with the highest share of female workers are seeing inflation outpace wage increases. The healthcare and education sectors, of which 75% of workers are women, had the second-to-lowest increase in nominal wages in 2022. “Women and minorities are underrepresented in higher-wage industries, such as technology or finance, that are more insulated from inflation pressures,” notes Dimple Gosai, Bank of America’s head of U.S. ESG strategy for CNBC.
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Moreover, men are more likely to receive a raise at or above the inflation rate, as evidenced, for example, by a 2022 US survey that found that men are 33.3% more likely than women to see their salary keep pace with inflation. And then, the older women are extremely touched: after leaving the workforce, they face not only rising health care costs but also a significant pension gap—26% across OECD countries.
“This is an issue that’s ingrained. It’s a bigger issue, and it touches so many different sectors and so many different geographies. That it isn’t something that’s just simply eradicated by inflation,” said Gosai for CNBC. “Women earn 82 cents for every USD 1 that a man earns. That’s something that doesn’t change [even] if inflation goes down tomorrow. It’s something that takes a long time to get fixed. It’s a vicious cycle.”
