While experts continue their quest of finding secrets for economic growth in common places, such as emerging markets and innovative industries, a new report from consulting firm Deloitte suggests an overlooked alternative: acknowledging women’s increasing purchasing power and their unfulfilled potential in the workplace.
According to the report, women are responsible for roughly $20 trillion of total consumer spending across the globe and make or influence up to 80 percent of all buying decisions.
These figures are putting business models to the test and forcing companies to better acknowledge women’s consumer preferences and market to them. This is a process the report describes as a “gender dividend.”
The term gender dividend also refers to the potential payoff down the road for not only investing in the development of women’s leadership skills, but also understanding the impact women have on the economy.
The report says that “gender dividend should be reflected in increased sales, expanded markets, improved recruitment and retention of a key talent segment.”
The report also notes that companies are not taking the time to determine what women’s specific needs are compared to men. The mistake is assuming that a single message will effectively reach both men and women.
According to the book “The Female Economy,” which surveyed women from 40 different regions across the globe, more than 80 percent of women believe that investment marketing doesn’t understand what they are looking for. Other consumer areas show similar results.
When it comes to the impact women have as decision makers, the Deloitte report recommends that countries analyze their policies to ensure they reflect reality in areas such as economic competitiveness, fiscal health, and sociopolitical stability.
“Countries must take specific actions toward rectifying any gaps or shortcomings they may have,” says Greg Pellegrino, global public sector industry leader at Deloitte. “Ultimately, those countries that gather female talent within their borders will be more competitive.”
According to the Organization for Economic Cooperation and Development, working women helped bring the poverty rate for two-person households down from 40 percent to 26 percent in 2007 in Latin America.
Women also accounted for half of the increase in Europe’s overall employment rate and one-quarter of its economic growth happened after narrowing the gap between male and female employment.
However, at this pace, “it could take until 2075 for women to reach parity with men on corporate boards,” says Ilene Lang, president of Catalyst, a research and advisory organization that focuses on issues of women and business, cited in the Deloitte report.
“With women making up nearly half the working population in many regions around the world, the report says, policies and investments targeting women will be critical in a global economy increasingly dependent on the intangible assets of people, brand, and intellectual property.”
Businesses able to capitalize on the role women play as economic actors will most likely attain a competitive advantage, since women will become the dominant source of economic growth in the near future, the study forecasts.