The future of the world economy lies increasingly in female hands



“WHY can't a woman be more like a man?” mused Henry Higgins in “My Fair Lady”. Future generations might ask why a man can't be more like a woman. In rich countries, girls now do better at school than boys, more women are getting university degrees than men are and females are filling most new jobs. Arguably, women are now the most powerful engine of global growth.

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 (see chart 1). Since 1950 men's employment rate has slid by 12 percentage points, to 77%. In fact, almost everywhere more women are employed and the percentage of men with jobs has fallen—although in some countries the feminisation of the workplace still has far to go: in Italy and Japan, women's share of jobs is still 40% or less.

The increase in female employment in developed countries has been aided by a big shift in the type of jobs on offer. Manufacturing work, traditionally a male preserve, has declined, while jobs in services have expanded. This has reduced the demand for manual labour and put the sexes on a more equal footing.

In the developing world, too, more women now have paid jobs. 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.

Of course, it is misleading to talk of women's “entry” into the workforce. Besides formal employment, women have always worked in the home, looking after children, cleaning or cooking, but because this is unpaid, it is not counted in the official statistics. To some extent, the increase in female paid employment has meant fewer hours of unpaid housework. However, the value of housework has fallen by much less than the time spent on it, because of the increased productivity afforded by dishwashers, washing machines and so forth. Paid nannies and cleaners employed by working women now also do some work that used to belong in the non-market economy.

Nevertheless, most working women are still responsible for the bulk of chores in their homes. In developed economies, women produce just under 40% of official GDP. But if the worth of housework is added (valuing the hours worked at the average wage rates of a home help or a nanny) then women probably produce slightly more than half of total output.

The increase in female employment has also 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. Carve up the world's economic growth a different way and another surprising conclusion emerges: over the past decade or so, the increased employment of women in developed economies has contributed much more to global growth than China has.......

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