Rachel Reeves has made history by becoming the UK’s first female chancellor of the exchequer, bringing with her a significant promise for change in economic and financial policy-making at the highest level.
The post of chancellor has existed for the past 800 years and, notably, has always been held by a man. Until now.
Other key roles in economic policy-making that have yet to be filled by a woman include the governor of the Bank of England and the first permanent secretary to the Treasury.
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Labour’s key ambition for the UK is economic growth, and Reeves is likely to be more empathetic in understanding the vital role of women in the workforce and their contribution to achieving this. As the first woman in Number 11, she will have the opportunity to influence, through policy and interventions, the support that women need to be fully integrated into the workforce as well as balancing family and caring responsibilities.
Reeves, a former Bank of England economist, has said she believes the opportunity to serve comes with significant responsibility. This includes demonstrating to other women that there should be no limits to their ambition.
She has also said that it is her duty to drive progress for women, and to close the gender pay gap, which currently stands at 14.3%. In addition, she wants to make flexible working the norm.
During the campaign she told interviewers how influential Labour women such as Barbara Castle, Harriet Harman and Ellen Wilkinson inspired her to keep fighting for equal pay and equal rights for women and other vulnerable groups.
The UK public can gain an insight into Reeves’ influences from her 2023 book The Women Who Made Modern Economics. Published when she was Labour’s shadow chancellor, Reeves intertwined the stories and contributions of female economists with her personal experiences and Britain’s political history.
In the book she makes a strong argument for the changes Labour – and she herself – will have to bring if they aim to improve the lives and futures of British families. The book addresses the persistent gender inequality in economic roles, emphasising the need for change in political and economic representation.
The austerity years
Since 2010 when the Conservatives came into power, first in coalition and then as majority governments, the UK has suffered the effects of a prolonged period of austerity measures, crippled public services, Brexit, COVID, international conflicts, sky-high inflation and a cost of living crisis.
There have been three elections (in 2015, 2017 and 2019), five prime ministers and a tax burden that has been the highest in the past 70 years. The tremendous political and economic turmoil of the past 14 years has contributed to a landslide Labour victory with a 170-seat majority.
In this time, women have borne the brunt of austerity measures since 2010, enduring the most severe impacts from cuts to public services and social support.
The economic and social consequences of the COVID pandemic further exacerbated these challenges for women, who suffered more job losses while facing extra caring responsibilities and a higher risk of domestic violence.
Moreover, women have traditionally been disproportionately affected by insecure work, low wages and underfunded public services, compounding their difficulties.
Reeves, along with the wider Labour Party, has reiterated that the primary economic goal is to reignite growth in the UK economy. She has promised to deliver an economic policy focused on equality for women, which is synonymous with an economic policy focused on growth.
Empowering women and ensuring their full participation in the economy is not only a matter of fairness but also a critical driver of economic success. Economic growth and gender equality are deeply interconnected.
If Reeves keeps her promise to invest in policies that support women – such as affordable childcare, equal pay and flexible working arrangements – the UK could unlock the full potential of half the population, leading to increased productivity and innovation.
When women are supported to contribute more effectively to the economy, it boosts not only household incomes but also economic resilience overall.
What’s more, addressing the challenges women face in the workforce, such as discrimination, unequal opportunities and occupational segregation (when women tend to end up in lower-paid sectors), can lead to a more inclusive and robust labour market. Ensuring that women have access to quality education and training opportunities also helps to build a skilled workforce ready to meet the demands of a modern economy.
Reeves’ vision for a thriving economy is one where women are empowered, their contributions are valued and their rights are protected. By centring UK economic policy on equality for women, the country could begin to chase the sustainable growth that the country has been promised will benefit everyone.
Her approach would not only rectify longstanding injustices. It could also pave the way for a more prosperous and equitable future for the whole country.
