Box 1. Wasted Potential—Indonesian women have higher levels of human capital, but work less, earn less, and are promoted less Indonesia is currently failing to support the very segment of the population that has higher levels of human capital. While Indonesia’s male labor force participation rate is 83.2 percent, for females the figure is at a dismal 51 percent.<sup>22</sup> With only roughly half the female working population currently employed or seeking employment, this represents a significant loss of human capital potential for the country. Reasons for the low female participation rate in Indonesia include, among others, lack of childcare options and social norms. A World Bank study in 2017 found that Indonesian women in urban areas who live with elderly family members take up to two years after childbirth to return to work; for women without elderly family members, this period can be twice as long due to a lack of childcare options.<sup>23</sup> Once women leave the workforce for an extended period of time, they may also experience more difficulties in returning.

Even when women in Indonesia do work, they are paid less than their male counterparts. In Indonesia, the gender wage gap exists with male wages being 20 to 25 percent higher than female wages (World Bank, forthcoming). Additionally, data from Sakernas 2017 show that there is a lack of gender parity in wages in six of the top nine job industries in Indonesia. Estimation shows that Indonesia could add US$135 billion a year to annual GDP by 2025 in a best-in-region scenario with three drivers: i) higher female labor-force participation, ii) a higher share of women working full-time rather than part-time, and iii) more women working in higher productivity sectors such as manufacturing instead of agriculture (MGI, 2018).

**Figure 5. Gender Parity Index (GPI) for wages/salaries by main industries**

|Trade<br>Transportation<br>Finance<br>Services||
|---|---|
|Agriculture<br>Mining<br>Industry<br>Electricity, water, and gas<br>Construction||
|0<br>0.2 0.4 0.6 0.8<br>1|1.2|
|Source: Sakernas, 2017.||

In the civil service, women comprise about 42 percent of civil service employees across 34 ministries. Echelon positions—the system by which career progression is measured, and the level of which indicates an individual’s position of hierarchy in the civil service—comprise less than 7 percent and, of those positions, women held just 26 percent in 2016. Through interviews, it was learned that women are promoted less often and that women seek fewer opportunities for promotion. Women achieve lower scores in bidding processes for promotions and are less able to participate in training for higher echelon positions due to time constraints and responsibilities at home. Several women who were interviewed noted that there is a lack of adequate childcare facilities at district, provincial and ministry offices. Women and men both noted that some positions are targeted specifically for men and that men are seen as better leaders.

The trend is no better in the legislative and judicative bodies. Law No. 10/2008 on General Elections, Article 8/1d, states that the list of parliament member candidates proposed to the General Election Committee should consist of at least 30 percent women. However, in the last legislative election, the percentage of women selected in the national parliament was still less than 20 percent. Since the members of the legislative are elected through a <u>general election, the female candidates were not chosen because they did not garner enough votes.</u> 12