The Sunday Times: It’s your Waterloo, chaps: a new epoch of female spending power is here
Here is a thought for when the bells ring in 2014: we are teetering on the edge of a new epoch. Historians should never pretend to be fortune-tellers, but we can recognise patterns. One of the most consistent over the past millennium has been the significance of years ending in 14 as a marker or gateway between eras. It is as though the tide of human events reaches the new century only after a decade and a half of frothy preamble.
In the 13th century, for example, 1214 was the year that the feudal barons turned against King John, followed in 1215 by the signing of Magna Carta.
The mass misery that characterised the 14th century, with its great famine and Black Death pandemic, began with the harvest failures of 1314. The meteoric rise of the Portuguese empire in the 15th century began in 1414 when Henry the Navigator laid down plans to attack the Moors.
The Reformation in the 16th century started quietly but inexorably in 1514 after Martin Luther took up his post at Wittenberg parish church. The absolute rule of the Bourbons began in 1614 during the reign of Louis XIII. The Georgian era commenced in 1714; the Napoleonic all but ended in 1814.
Finally, in 1914 the Great War ushered in the modern age with its medicines, its machines and its weapons of mass destruction.
Since then, the pace of change has accelerated as the industrial age has given way to the information age. Four hundred years ago the poet John Donne wrote that every member of humanity was connected: “no man is an island . . . never send to know for whom the bell tolls; it tolls for thee.” In this era of the global economy, Donne’s metaphysical conceit has become flesh. From Congo to China, from Chile to Canada, we have become yoked together in ways that were once unimaginable and are now irreversible.
For 2014 the epoch-in-waiting is the “participation age” — the era when the full economic potential of women is set free. What that means, and why it is so important, is beautifully demonstrated in the statistics contained in a research paper commissioned by Goldman Sachs. The study estimated that if all the impediments and employment restrictions affecting western women today were suddenly to disappear tomorrow, America’s GDP would jump by 9% and the eurozone’s by 13%.
The participation age has become possible because the argument for women’s rights has moved from being a moral issue (be kind to the weaker sex) and a practical issue (there’s no brawn required in tapping a keyboard) to an economic truth — women are creators of wealth. As it is, a milestone will be reached in 2014, when, in global terms, women will control £17 trillion in purchasing power. By 2028 they will be responsible for nearly three-quarters of the world’s consumer spending.
The idea that a nation can be judged by the status of its women is hardly new. The 18th-century French philosopher and politician the Marquis de Condorcet was among the first to articulate this point.
Before his death in prison in 1794, Condorcet tried in vain to persuade his fellow revolutionaries to grant political rights to women. He even published a pamphlet at great personal cost, On the Admission of Women to the Rights of Citizenship. But only recently have economists been able to demonstrate, as Condorcet could not, the financial advantages that accrue to a fully integrated society.
It turns out that they are substantial. A joint study published by Chicago and Stanford Universities earlier this year revealed that 15-20% of America’s productivity growth over the past 50 years — more than £2 trillion — can be traced to a single source: “the improved allocation of talent”.
In other words, when jobs became open to all applicants and not just to those in possession of a Y chromosome, the best man for the job frequently turned out not to be a man at all. In Britain women now outnumber men in medical school and have almost achieved parity in the number of practising solicitors.
In 1968 the female sewing machinists at the Ford Dagenham plant famously went on strike in protest against being paid 15% less than their male equivalents. The company held out until losses worth £117m in today’s money forced the two sides to the negotiating table. Even then the women were able to nudge the needle only a little, settling for an increase that paid them merely 8% less than the men. Still, their actions paved the way for the 1970 Equal Pay Act.
How vital the Dagenham women have been to Britain’s prosperity can be judged from the countries that have ignored the issue of women’s pay. Russia, for example, did not pass a specific gender equality law until 2011. By then the wage gap between men and women had increased in some areas to 40%. Economists claim that addressing this imbalance alone would lead to a vastly expanded middle class and a rise in per capita incomes of almost 5% in Russia by 2020.
Equally important are the future gains that lie within the grasp of women in emerging markets. Helped by the spread of ICT — information and communication technology — the new global economy plays directly to female strengths such as probity, self-reliance, self-improvement and forward planning. Numerous studies have shown that female workers bring far greater returns to the economies of developing countries: they save more of their income than men, and what they do spend they do so wisely, on education, nutrition and health for their families. In short, women’s freedom and economic growth go hand in hand.
The clearest evidence for the transformational power of female productivity comes from Latin America and the Caribbean. Despite some powerful forces pulling in the opposite direction, the 1990s witnessed a steady opening of doors to women in all areas of the labour market. The result, according to the World Bank, is that the extreme poverty that once characterised the region has decreased by more than 30%.
It is a fact that the countries with the greatest poverty, the least education and the highest threats to peace and security are also the countries where women suffer the most discrimination. In recognition of this, the United Nations, the World Bank, the Bill and Melinda Gates Foundation and other global organisations have dedicated substantial resources to supporting the empowerment of women. But they cannot work in a vacuum. At least 30 of the world’s 196 countries have yet to achieve gender parity at the primary-school level, let alone higher up the scale.
Whether the countries of the developing world participate in the peace and prosperity of the global marketplace or continue to be relegated to the fringes is a question that lies within their power to decide. As Andy Warhol once declared: “They always say that time changes things, but you actually have to change them yourself.”
Amanda Foreman is writing The World Made by Women: A History of Women fom the Age of Cleopatra to the Era of Thatcher and filming a documentary series of the same name for BBC2.
@dramandaforeman Camilla Cavendish is away