In our previous post analyzing the spending power gender gap, we explored North and Central America which includes the Carribbean Island Nations. Overall, the United States has the highest spending power gender gap in favor of men ($1,561 in 2011 PPP) and has a huge influence over the gender gap of the whole continent ($1,109) due to its dominant share (82%) of spending power. This time, we look at South America.
South America gender gap to remain flat
According to McKinsey’s recent report on Latin America, there are gender disparities that are affecting the region such as the level of female participation in the workforce. Our data indicates that the annual spending power gender gap across South America is expected to remain relatively flat over the next decade, counter to the worldwide trend. Over the next decade, the gap in favor of men is expected to increase by only 1.6%, from $258.66 to $262.88. However, that’s generally not the case when each country is looked at individually.
Chile and Argentina
In South America, Chileans have the highest average spending power but this is also where the spending power gender gap is the highest. Men on average have $1,049 more to spend per year than women. This gap is set to widen over the next decade by $84.32 (8%) even though overall growth in spending power is supposed to be slightly more for women (29.48%) than men (27.94%).
More similar to the continent as a whole, in Argentina, the spending power gender gap is expected to remain flat over the next decade with men currently having $268.94 more to spend than women on average. By 2030, this gap will increase only $3.96 (1.5%) to $272.9. On average, spending power will increase to $15,956 for a man and $15,683 for a woman per year.
Uruguay, Paraguay, and Brazil
Currently, Uruguayans have the second highest spending power in all of South America after Chile. With regards to the spending power gender gap, it is the only country on the continent where the spending power between genders is essentially flat. Currently, women have $2.63 more to spend per year and this is expected to increase to $7.44 by 2030.
In Paraguay, men on average have $435.95 more to spend per year than women. This amounts to 6.2% in extra spending power. Over the next decade, this gap will widen to $508.46, an increase of 16.6%.
Brazil is the largest country in South America and due to its size, represents almost half of all spending power on the continent. Men on average have $251.60 more to spend than women. However, this gap will shrink around 9% over the next decade to $228.86, one of the few countries to exhibit this trend on the continent.
Colombia and Ecuador
Both Colombia and Ecuador have a gender spending power gap in favor of men. For Colombia, it’s currently $162.72 and this is expected to increase 17% over the next ten years to $190.24 while average spending power is projected to increase 32% overall. In Ecuador, the spending power gender gap is currently $434.71 and is expected to increase 8% to $468.95 which is along the same lines of the expected growth in spending power for both genders (10%). It should be mentioned that as a percentage of average female spending power, the gender spending power gap affects Ecuadorians (7.4%) more than Colombians (2%) given the differences in average spending power between the countries.
Peru and Bolivia
In Peru, men have on average $253.83 (3%) more to spend than women. This is expected to widen to $272.37, reflecting an increase of 7%. Bolivian men have a similar amount of extra consumption compared to their Peruvian neighbours, $293.56, but given their lower spending power, it represents 7% extra spending power compared to women. This is expected to widen to $379.50, a 29% increase.
Guyana and Suriname
Guyana is expected to experience an oil boom. As a result, the country is expected to experience drastic poverty reduction and an increase of average spending power from $6,319 today to $42,000 by the end of the next decade. As a result, the spending power gender gap in the country is also expected to increase from $425.90 to $1,199.81 to become the highest in all of South America by 2030.
Suriname currently has the second largest gender spending power gap in South America which is $842.82 in favor of men. Given the average spending power, this amounts to men having over 10% more to spend than women. The gap is expected to widen to $1,043.70 over the next decade.
Given the issues affecting the country, Venezuelans have the lowest average spending power on the continent ($3,424). Men on average have $174.88 more to spend than women (5%). Over the next decade, this gap is expected to narrow by $13.15 to $161.73.
South America’s annual spending power gender gap ($258.66) is not much higher than the world average ($236.62) and the overall increase over the next ten years is expected to be much less than the world average. The largest gender spending power gap on the continent is found in Chile ($1,049) followed by Suriname ($843) and Paraguay ($436). By the end of the next decade, the largest increase in the gender power spending gap is expected to take place in Guyana ($774) followed by Suriname ($201) and Bolivia ($85.94). The largest decrease in the gender gap is expected to be in Brazil ($22.74), and Venezuela ($13.15). By the end of 2030, the countries with the smallest difference in spending power between genders will be Uruguay ($7.44 in favor of women), Venezuela ($161 in favor of men), and Colombia ($190 in favor of men).
According to the World Economic Forum’s The Global Gender Gap Report, it will take 74 years for Latin America to close the gap. If countries in South America want to accelerate this trend, they should look to Uruguay to see what kind of policies need to be implemented in order to close the spending power gender gap.