Working Women
In 1950 only one-third of American women of working age had a paid job. Today two-thirds do, and women make up almost half of America’s workforce. Since 1950 men’s employment rate has slid by 12 percentage points, to 77%.
In the emerging East Asian economies, for every 100 men in the labour force there are now 83 women, higher even than the average in OECD countries. Women have been particularly important to the success of Asia’s export industries, typically accounting for 60-80% of jobs in many export sectors, such as textiles and clothing.
The increase in female employment has accounted for a big chunk of global growth in recent decades. GDP growth can come from three sources: employing more people; using more capital per worker; or an increase in the productivity of labour and capital due to new technology, say. Since 1970 women have filled two new jobs for every one taken by a man. Back-of-the-envelope calculations suggest that the employment of extra women has not only added more to GDP than new jobs for men but has also chipped in more than either capital investment or increased productivity.
Surveys suggest that women make perhaps 80% of consumers’ buying decisions.
Kathy Matsui, chief strategist at Goldman Sachs in Tokyo, has devised a basket of 115 Japanese companies that should benefit from women’s rising purchasing power and changing lives as more of them go out to work. It includes industries such as financial services as well as online retailing, beauty, clothing and prepared foods. Over the past decade the value of shares in Goldman’s basket has risen by 96%, against the Tokyo stockmarket’s rise of 13%.
At school, girls consistently get better grades, and in most developed countries well over half of all university degrees are now being awarded to women. In America 140 women enroll in higher education each year for every 100 men; in Sweden the number is as high as 150. (There are, however, only 90 female Japanese students for every 100 males.)
Women account for only 7% of directors on the world’s corporate boards — 15% in America, but less than 1% in Japan. Yet a study by Catalyst, a consultancy, found that American companies with more women in senior management jobs earned a higher return on equity than those with fewer women at the top. Studies suggest that women are often better than men at building teams and communicating.
Researchers have also concluded that women make better investors than men. A survey by Digital Look, a British financial website, found that women consistently earn higher returns than men. A survey of American investors by Merrill Lynch examined why women were better at investing. Women were less likely to “churn” their investments; and men tended to commit too much money to single, risky ideas.
Less than 50% of Italian women and only 55-60% of German and French women have paid jobs. But Kevin Daly, of Goldman Sachs, points out that among women aged 25-29 the participation rate in the EU (ie, the proportion of women who are in jobs or looking for them) is the same as in America. Among 55- to 59-year-olds it is only 50%, well below America’s 66%. Over time, female employment in Europe will surely rise, to the benefit of its economies.
A study last year by the World Economic Forum found a clear correlation between sex equality (measured by economic participation, education, health and political empowerment) and GDP per head.
There is strong evidence that educating girls boosts prosperity. Not only are better educated women more productive, but they raise healthier, better educated children. More than two-thirds of the world’s illiterate adults are women.
Countries with high female labour participation rates (such as Sweden) tend to have higher fertility rates than countries (such as Germany, Italy and Japan) where fewer women work.
Countries in which more women have stayed at home, namely Germany, Japan and Italy, offer less support for working mothers. This means that fewer women take or look for jobs; but it also means lower birth rates because women postpone childbearing. Japan, for example, offers little support for working mothers: only 13% of children under three attend day-care centres, compared with 54% in America and 34% in Britain.
“A Guide to Womenomics,” The Economist