09.16.11

Hillary: Global Economy Depends on Women

The secretary of State says allowing women to participate in the world’s marketplace can help save the economy. Gayle Tzemach Lemmon reports on Clinton’s address to an APEC summit.

The world must match its words with its wallet and its will when it comes to women not just because it is the right thing to do, but because the ailing global economy depends on it. That is the message Secretary of State Hillary Clinton delivered Friday to delegates from the globe’s most powerful economies gathered in San Francisco for the Asian-Pacific Economic Cooperation’s (APEC)  Women and the Economy Summit.

“To achieve the economic expansion we all seek we need to unlock a vital source of growth that can power our economies in the decades to come,” Clinton told a ballroom filled with women—and some men—gathered in the same city where the original United Nations Charter was signed in 1945. “By increasing women’s participation in the economy and enhancing their efficiency and productivity, we can have a dramatic impact on the competitiveness and growth of our economies.”

Striking themes reminiscent of her 1995 address in Beijing to the Fourth World Conference on Women in which she famously stated that “women’s rights are human rights,” Clinton urged policymakers to back up their rhetoric about the importance of women with concrete steps aimed at tackling barriers to economic and political participation they face across APEC economies. Together the APEC nations, which include the United States, Russia, Japan and China, account for more than half of global GDP and 40 percent of the world’s population.

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Clinton: Women Are the Key to Economic Growth

“When it comes to the enormous challenge of our time—to systematically and relentlessly pursue more economic opportunity in our lands—we don’t have a person to waste and we certainly don’t have a gender to waste,” Clinton said. “Here, at the beginning of the 21st century, we are entering the Participation Age, where every individual, regardless of gender or other characteristics, is poised to be a contributing and valued member of the global marketplace.”

Today women entrepreneurs face challenges obtaining capital, reaching markets and accessing networks. Fewer than 3 percent of Fortune 500 companies in the United States have a female CEO. And in much of the world laws that bar women from owning land or inheriting property keep women from accessing financial services. A 2007 U.N. report noted that the Asia-Pacific region is “losing $42 billion to $47 billion per year because of restrictions on women’s access to employment opportunities—and another $16 billion to $30 billion per year because of gender gaps in education.”

All of this, Clinton argued in her speech, is an unnecessary drag on a global economy facing the very real threat of return to recession. It is time, Clinton will say, to reverse these numbers—for everyone’s sake.

“There is a stimulative and ripple effect that kicks in when women have greater access to jobs and the economic lives of our countries: Greater political stability. Fewer military conflicts. More food. More educational opportunity for children,” Clinton said. “By harnessing the economic potential of all women, we boost opportunity for all people.”

In the past a lack of hard data was part of the problem with pushing political leaders to address the opportunity gap between men and women. Now the numbers tell the story—and more of them are needed.

“Unlocking the potential of women by narrowing the gender gap could lead to a 14-percent rise in per capita incomes by the year 2020,” Clinton said.  “For every one percentage point increase in the share of household income generated by women, aggregate domestic savings increase by roughly 15 basis points.”

But not enough is being done to measure what works and what doesn’t when it comes to tapping women’s economic potential, Clinton said.

“At the governmental level, we routinely measure unemployment, job growth, our national debt, GNP and our balance of trade,” Clinton pointed out.  “Shouldn’t we be at least as attentive to collecting, analyzing and publicizing the facts as we seek to move women into the mainstream of economic life in our nations?”

And that mainstream includes politics.

“We must support the rise of women leaders in the public and private sectors because frankly, they are more likely to have firsthand knowledge and understanding of the challenges women face,” Clinton said. “Their perspectives add value and insure that we shape policies and programs that are not just ‘window dressing’ but successfully eliminate barriers and bring women into all our economic sectors.”

Excerpts of Secretary of State Hillary Clinton’s speech to the APEC Women and the Economy Summit:

The big challenge we face in these early years of the 21st century is how to grow our economies and ensure shared prosperity for all nations and all people.

We want to give every one of our citizens, men and women, young and old, greater opportunity to find work, save and spend money, pursue happiness, and ultimately live up to their God-given potential.

That is a clear and simple vision.

But to make it real—to achieve the economic expansion we all seek—we need to unlock a vital source of growth that can power our economies in the decades to come.

That vital source of growth is women.

With economic models straining in every corner of the world, none of us can afford to perpetuate the barriers facing women in the workforce.

By increasing women’s participation in the economy and enhancing their efficiency and productivity, we can have a dramatic impact on the competitiveness and growth of our economies.

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The transformative nature of the undertaking that lies ahead is, in my view, not unlike other momentous shifts in the economic history of our world. I believe that here, at the beginning of the 21st century, we are entering the Participation Age, where every individual, regardless of gender or other characteristics, is poised to be a contributing and valued member of the global marketplace.

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If we really want to achieve full parity for women in the workforce – both that they participate and how they participate – we must remove the structural and social impediments stacking the deck against them.

I don’t urge this because it is the right thing to do, though of course it is.

For the sake of our children and our nations, it is the necessary thing to do.

Because a rising tide of women in an economy raises the fortunes of all families and all nations.

My husband often has said, in making the argument that everyone counts in life, “we don’t have a person to waste.”

That is true.

When it comes to the enormous challenge of our time—to systematically and relentlessly pursue more economic opportunity in our lands—we don’t have a person to waste… and we certainly don’t have a gender to waste.

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If women are already making such contributions to economic growth, why do we need a major realignment in our thinking, markets and policies?

Because evidence of progress is not evidence of success.

And the rate of progress for women in the economies of our region varies widely.

Laws, customs, and the values that fuel them all act as roadblocks to full inclusion.  In the United States and in every economy in APEC, millions of women are still sidelined, unable to find a meaningful place for themselves in the formal workforce.

And some of those who get jobs are confined to the lowest rungs on the job ladder by a web of legal and social restrictions that limit their potential.

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Unlocking the potential of women by narrowing the gender gap could lead to a 14-percent rise in per capita incomes by the year 2020 in several APEC economies, including China, Russia, Indonesia, the Philippines, Vietnam, and Korea.

Women are stronger savers than men.

Data from 20 semi-industrialized countries suggests that for every one percentage point increase in the share of household income generated by women, aggregate domestic savings increase by roughly 15 basis points.

And a higher savings rate translates into a higher tax base as well.

Integrating women more effectively into the way businesses invest, market and recruit also yields benefits in terms of profitability and corporate governance.

In a McKinsey survey, a third of executives reported increased profits as a result of investments in empowering women in emerging markets.

Research also demonstrates a strong correlation between higher degrees of gender diversity in the leadership ranks of business and organizational performance.

When we liberate the economic potential of women, we elevate the economic performance of communities, nations, and the world.

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The Declaration we will adopt here today can begin to close that gender gap, by making it possible for more women to unleash their potential as workers, entrepreneurs, and business leaders.

We must commit to giving women access to capital so women entrepreneurs can turn their ideas into the small and medium enterprises that are the source of so much growth and job creation in our economies

We must examine and reform our legal and regulatory systems so women can avail themselves of the full range of financial services.  Such reforms can also help ensure that women are not forced to compromise on the well-being of their children to pursue a career.

We must improve women’s access to markets so those who start businesses can keep them open.

For example, we need to correct the problem of information asymmetry – making sure women are informed about opportunities for trade and orienting technical assistance programs so they serve women as well as men.

Finally, we must support the rise of women leaders in the public and private sectors because frankly, they are more likely to have firsthand knowledge and understanding of the challenges women face.  Their perspectives add value and insure that we shape policies and programs that are not just “window dressing” but successfully eliminate barriers and bring women into all our economic sectors.

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I do not underestimate the difficulty of ushering in this Participation Age.

Legal changes require political will.

Cultural and behavioral changes require social will.

All of this requires leadership – by governments, by civil society, and by the private sector.

And even when countries pursue aggressive structural reforms to get women into the economy and enhance their productivity, they don’t always produce the kind of results we seek.

So we need to be persistent and be comprehensive in our approach.

By being big and bold in our thinking and transformational in our policies and practices, we will find many other benefits for our society, beyond the economic. There is a stimulative and ripple effect that kicks in when women have greater access to jobs and the economic lives of our countries: Greater political stability. Fewer military conflicts.  More food. More educational opportunity for children. Financial stability for more families in the world, yielding exponential dividends across the entire spectrum of human activity.

Our Declaration is meaningless if we don’t put muscle behind our mission.

This Summit “just might” make the history books.

But it will do so only if we make history by empowering our rhetoric with concrete action.

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We also need a way to measure our progress.

At the governmental level, we routinely measure unemployment, job growth, our national debt, GNP and our balance of trade.

We are concerned about all those things, and knowing the facts helps drive our policy choices, course enhancements and corrections.

Shouldn’t we be at least as attentive to collecting, analyzing and publicizing the facts as we seek to move women into the mainstream of economic life in our nations?

How else can we determine whether we’re heading in the right direction?

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In pursuing the promise of the Participation Age, let us remember that by harnessing the economic potential of all women, we boost opportunity for all people.

And we boost the economies of all our nations.

This is indeed the starting line of a great race to a promising future, but only if we run a smart race, with passion and practicality; only if we take time to measure and course correct our progress along the way.

Only then will this starting line also mark a turning point in history.