Saturday, October 24, 2009

The Female Economy

"Women now drive the world economy." The September 2009 issue of Harvard Business Review reinforces this point. Women represent the largest market opportunity in the world. Globally they control about $20 trillion in annual consumer spending and that figure could climb as high as $28 trillion in the next five years. In aggregate, women represent a growth market bigger than China and India combined.

Women make the decision in the purchases of 94% of home furnishings, 92% of vacations, 91% of homes, 60% of automobiles, and 51% of consumer electronics. Doing all that in an environment where 39% work more than 40 hours per week.

The 2008/09 severe global recession also has changed the landscape for many male-dominated segments of the economy. Manufacturing and real estate development/construction - historic bastions of male dominance - have declined rapidly, and probably will never recover to their past glories as drivers of our economic engine. On the other end of the scale, education and medical services - centers of female employment will see a greater share of the national and international GDP. This points to a future of parity, power, and influence for females in "The Female Economy." When the dust from the current economic crisis settles, many experts are predicting women will occupy an even more important position in the economy and world order than they now do.

The engineering profession needs to understand the fundamental importance of this economic, societal, and cultural transformation. Approximately 8% of the engineering workforce is female. In this context, an additional 90 million or so women are expected to enter the workforce by 2013. At nearly every major consumer company, most middle managers are women. Its only a matter of time before they rise to more senior positions. Already, women own 40% of the businesses in the United States and their businesses are growing at twice the rate of U.S. firms as a whole.

The interesting issue is how do you transform organizations in which a labor force that is 92% male - designing things for customers that are 70% female? Only one side of the equation is controllable - the 92% side. This side of the equation needs to either become more balanced (in all aspects - ownership, management, engineering, etc.) or the 92% segment needs to fully understand and appreciate their customer base.

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