Women hold a key to GDP growth
Closing the gender gap and increasing female productivity in the workplace could boost New Zealand's gross domestic product (GDP) by 10 per cent, according to global investment management firm Goldmans Sachs.
Progress had been made on closing employment gaps over the past 40 years, but New Zealand was only three-quarters of the way to unlocking the value of its female labour pool, Goldman Sachs said in the first gender-based productivity report on the New Zealand market.
According to economist Philip Borkin, the rise in the female employment rate since 1970 had lifted New Zealand economic activity by 30 per cent.
''We believe there is a large, undertilised pool of highly educated workers in New Zealand that has the potential to substantially boost New Zealand's economic performance,'' he said. '' Against a backdrop of pending strains that the rebuilding of Christchurch will place on the labour market, we feel this is particularly important.''
Two years ago, Goldman Sachs in Australia released a report on Australian female labour force participation and productivity which had similar findings.
The New Zealand report found there was a large concentration of women working in non-cyclical sectors of the economy such as healthcare, education and professional and scientific services (45 per cent of all female hours worked). Combined with retail, 57 per cent of total female hours worked were concentrated in just four industries.
Despite a lower participation rate and concentration of employment in just a few sectors, women were generally more educated than males.
But despite being better educated, on average females still earn only 83 per cent of what men do. There was not a single industry where women earned more than men on average.
Goldman Sachs recommended a number of ways to close the gender gap. Suggestions included more work on whether specific targets should be introduced on company boards, or whether New Zealand should follow the Australian Stock Exchange's lead in introducing increased disclosure requirements.
A 2006 Sunday Star Times article on why women shunned investment banking in New Zealand, despite its huge financial rewards, revealed that there were only two female investment banking staff at the major New Zealand firms, at Goldman Sachs.
Other recommendations from the report included ensuring a higher level of labour mobility, which would become more important when the earthquake reconstruction absorbed a lot of the country's skilled workers. The possibility of broadening the Modern Apprenticeship scheme or other on-the-job training initatives could also be explored.
Looking at the availability and cost of childcare and the high effective marginal tax rates on some women on welfare, particularly second income earners, could also be helpful, the report said.
And given the success of Scandanavian countries in encouraging female workforce participation, the report recommended assessing whether there were policies New Zealand could adopt, particularly around childcare support.