Deloitte report urges public and private sectors to reap the “gender dividend” by investing in women
Economic growth, competitive advantage hinges on capturing women's insights in the workplace and their role as consumers
New York, 25 January 2011—As governments around the world debate the best policies, regulations, and practices to spur economic growth in 2011 and beyond, they would benefit from looking less at regions and industries and more at demographic information and the vital role women play in driving economic growth, according to a new report published today by Deloitte, "The gender dividend: Making the business case for investing in women."
Investments in women can yield a significant “gender dividend,” both from women as workers and as consumers, argues the report, which features an interview with Melanne Verveer, U.S. Ambassador-at-Large for Global Women’s Issues. According to the Organisation for Economic Co-operation and Development, since 1995, narrowing the gap between male and female employment has accounted for half of the increase in Europe’s overall employment rate and one-quarter of economic growth. And in Latin America, working women helped bring the poverty rate for two-person households down to 26 percent from 40 percent in 2007.1
Women also play a significant role in economies as a growing consumer market. Women control roughly US$20 trillion of total consumer spending globally and make or influence up to 80 percent of buying decisions.2 In the United States alone, the number of women with six-figure incomes is rising at twice the rate of men.3
“Governments and public entities need to take a hard look at their policies for economic growth to ensure they reflect the impact of women as decision makers—voters, consumers, and leaders in the public and private sectors,” says Greg Pellegrino, Global Public Sector Industry Leader, Deloitte Touche Tohmatsu Limited. “The role women play—or lack thereof—can affect economic competitiveness, fiscal health, and even sociopolitical stability. Countries must take specific actions toward rectifying any gaps or shortcomings they may have. Ultimately, those countries that gather female talent within their borders will be more competitive.”
With an aging population and a shortage of skilled workers looming, economies must draw on all resources of talent. And with women making up nearly half the working population in many regions around the world, the report says, policies and investments targeted at promoting women will be critical in a global economy increasingly dependent on the intangible assets of people, brand, and intellectual property.
Furthermore, companies need to understand women’s preferences and how to market to them as consumers. According to the report, 80 percent of women feel that investment marketers don’t understand their needs, with 50 percent feeling the same about the marketers of healthcare and food products. Given the power of the female consumer, these levels of unease can decrease competitiveness.
“The current operating model in most organizations is to think of talent as a cost and women as a niche group,” says Pellegrino. “Companies need to move past this mindset and respond to the current knowledge-based economy, where women are essential to economic prosperity.”
Implemented correctly, according to the report, the gender dividend can be reflected in increased sales, expanded markets, and improved recruitment and retention of key talent. To achieve the dividend, public organizations need to focus on the collective perspectives of both men and women, which can lead to better decisions and more effective leadership.
“The ultimate goal is gender parity,” says Ambassador Verveer. “We need to address the fact that women are not second-class citizens. Together, not separately, men and women build vibrant economies and prosperous countries.
“To completely negate—as we have—the role that women play, we are penalizing ourselves," adds Verveer. “We are penalizing the world and businesses we want to create.”
"The gender dividend: Making the business case for investing in women," the first in a series, is a road map for constructing the business case for smarter investments in women. The report lays out the core rationale for why governments and organizations must look to women as key to their economic growth. To read the full paper visit www.deloitte.com/investinginwomen or view the "Focus on the issues" theme at www.deloitte.com/genderdividend
1Carmen Pagés and Claudia Piras, The Gender Dividend: Capitalizing on Women’s Work.
2“A Guide to Womenomics,” The Economist, 12 April 2006; Sandra Lawson and Douglas Gilman, The Power of the Purse: Global Equality and Middle Class Spending, Goldman Sachs Global Research Institute, 2009.
3Carol Morello and Dan Keating, “More U.S. women pull down big bucks,” The Washington Post, 7 October 2010.
As used in this release, “Deloitte” refers to Deloitte Touche Tohmatsu Limited.
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