What will drive the global economy of the 21st century? The usual answers are either the emergence of China, India and other developing national economies or technological advancements like AI and the Internet of Things. What’s often left out of the equation is women.
But there’s plenty of evidence to say that the empowerment of women to take part more fully in the global economy will also play a significant role in driving global growth.
A Booz & Co. report from 2012 titled ‘Empowering the Third Billion: Women and the World of Work in 2012’ laid out the case for why greater participation and utilisation of women would prove beneficial for not only women, but for their communities and the global economy as well. The ‘third billion’ in the title refers to the number of women expected to have entered the global workforce in the decade to 2020. These women will drive GDP growth through their work and their spending.
“Women are poised to play a significant role in the global economy in the coming decade—as significant as that of the billion-plus populations of India and China—yet this Third Billion has not yet received sufficient attention in many countries from governments, business leaders, or other key decision makers,” the report says.
Another report, by the McKinsey Global Institute, conservatively estimates $12 trillion could be added to global GDP by 2025 by advancing women’s equality, and $28 trillion if women were to achieve full pay parity with men.
If we look around us, we can already see the way women are changing the global economy for the better. With fuller participation and better access to opportunities such as business financing, we could see the world becoming a more prosperous place for all of us.
Here are five ways women are making a difference to the world economy.
Workforce participation rates are rising for women
The primary way in which women are remaking the world economy is labour force participation. By merely taking up paid employment or starting a business, women are reshaping their lives and the world. Despite the continued problems associated with gender pay gaps, many women have made the critical advance of getting on the first rungs of the ladder to financial independence and security. This is the foundation step for women in many countries around the world. Once this has been achieved, women can start to take a more significant role in business, politics, and other aspects of society.
It’s worth looking at the graph for Female Labor Force Participation at Our World In Data to get a better idea of the progress that has been made in the past few decades. Participation rates have risen almost uniformly throughout the world. That means more women are making money and have at least some expendable income, leading to increased purchasing power and more money in the economy.
Women now have greater purchasing power
Increased workforce participation is translating into higher total consumer spending for women worldwide; in 2013, women spent $US29 trillion globally, and in 2018 it is $40 trillion, according to Statista. That’s a reasonably broad and blunt measure, but it indicates the gradual financial empowerment of women.
Women have more financial independence and security than ever before. It’s still not as much as men, but it is on the rise. Part of that increase in purchasing power is also coming from the fact more women are starting businesses and taking control of their financial wellbeing.
Female entrepreneurs are starting up and standing out
Women are making inroads into the previously male-dominated arena of entrepreneurialism. The typical idea of an entrepreneur is still very much defined by examples like Richard Branson, Steve Jobs, Mark Zuckerberg and Jeff Bezos. However, women are starting to make their mark, and we’re seeing more female entrepreneurs showcased in the media, which will act as a model of encouragement for other women to emulate.
Workplace cultures are changing
The #MeToo movement provided a graphic and disturbing insight into the experiences of many women in workplaces. Sexual harassment, as well as bullying, can afflict both men and women, but women experience these problems disproportionately to men. That’s an expression of the power imbalance a lot of women face at work. Women are still struggling to stand up and make their voices heard. More of us have found the confidence to do so, but there are still many of us who shrink and freeze when confronted by these kinds of behaviours.
As with any cultural change, it’s going to take time, but be assured that women will no longer put up with the type of stuff that used to be considered just part and parcel of office culture. The new workplace cultures will have to adjust and factor in respect for everyone. For some people, that might take the ‘fun’ out of things, but for others, it will provide a space where they can go about their professional duties without being belittled or degraded.
Women are helping lift developing nations out of poverty
A big part of raising living standards in developing countries, and helping those countries play more prominent roles in the global economy, is to empower women to become educated and take on paid employment. This is happening across the world, from places like Bangladesh to Brazil. Women in developing countries face lots of economic and cultural barriers to financial independence. Once these barriers start to be dismantled, we will see liberation for not only women, but for the economies of these countries too.