The largest economy in the world is now largely controlled by women, and they are working to change this. In US President Joe Biden’s administration, women hold prominent positions such as Treasury Secretary Janet Yellen, Commerce Secretary Gina Raimondo, and trade czar Katherine Tai. Additionally, nearly 48% of his confirmed cabinet-level officials are women.
Economic policy may already be being impacted by this radical shift; in fact, a new $2.3 trillion spending plan unveiled by Biden last week includes $400 billion to support the “care economy,” which supports jobs that women typically perform at home and in the community to care for elderly and children. These jobs have historically received little recognition.
Hundreds of billions more dollars are included in the plan to address racial and rural-urban disparities that were partly brought about by previous trade, labor, and economic policies.
Yellen claims that the prioritization of “human infrastructure” and the $1.9 trillion rescue bill should have a substantial positive impact on everyone, including women, whose labor force participation had already fallen to 40-year lows prior to the crisis.
She stated on Twitter, “This is just the start for us. In the end, it might be that this bill makes 80 years of history: it begins to fix the structural problems that have plagued our economy for the past four decades.”
According to experts, female leaders can offer new insights into economic policy. “When you’re not like everyone else in the group, you see things differently,” said Harvard Business School professor Rebecca Henderson, the author of “Reimagining Capitalism in a World on Fire.”
She said, “You tend to be more open to different solutions,” and the circumstances call for that. “We’re experiencing a severe crisis right now. We require fresh perspectives.
Compassion and steadiness
Although 57 women have served as president or prime minister of their nations in the last 50 years, until recently, institutions that make economic decisions were predominately run by men.
A decade ago, men held these positions: Ngozi Okonjo-Iweala at the World Trade Organization, Kristalina Georgieva at the International Monetary Fund with its $1 trillion lending capacity, and Christine Lagarde at the head of the European Central Bank with its 2.4 trillion euro balance sheet.
An annual report from OMFIF, a think tank focused on central banking and economic policy, states that women lead finance ministries in 16 countries and 14 of the world’s central banks overall.
According to the scant data, women appear to be more adept at handling complex institutions during times of crisis.
Citing data from the IMF and other organizations, Georgieva stated in January that “the evidence is very clear: communities are better, economies are better, the world is better when women are involved.”
Women are excellent leaders because we are compassionate and stand up for those who are most in need. Women can be more willing to reach a compromise and are more decisive than men.
According to a study by the American Psychological Association, states in the US led by women had lower rates of Covid-19 deaths than those led by men. Additionally, the Harvard Business Review reported that during the period of March to June 2020, women received noticeably higher ratings in 360-degree assessments of 60,000 leaders.
Less than 2% of CEOs and less than 20% of executive board members are women in the financial sector, but the institutions they do lead exhibit higher levels of financial stability and resilience, according to IMF data.
During a meeting with Yellen and the leaders of Christian and Jewish faith groups last month, Eric LeCompte, an executive director of a non-profit that promotes debt relief and a UN adviser, said he saw a noticeable difference.
“After 20 years of meeting with Treasury secretaries, their talking points have changed completely,” he remarked. “Yellen emphasized empathy and the impact of policies on vulnerable communities in every area we discussed.”
He claimed that the “brass tacks” strategy of her male predecessors put “numbers not people” first and never used terms like “vulnerable.”
The world she-session
High stakes are involved. Many economists refer to the coronavirus-related global recession as a “she-session” due to how severely it has affected women.
Women make up 39 percent of the workforce worldwide, but they also cause 54 percent of job losses overall, according to a recent McKinsey study. More than half of the 10 million jobs lost in the US during the COVID-19 pandemic were held by women, and over 2 million of them have completely left the labor force.
According to IMF estimates, putting these women back to work could increase GDP by 5% in the US, 9% in Japan, 12% in the United Arab Emirates, and an incredible 27% in India, the largest democracy in the world.
The World Bank’s chief economist, Carmen Reinhart, told Reuters that the rise of female leaders should result in “a more inclusive — in the true sense of the word — response to the many, many challenges that are the legacy of Covid.”
Tai, the first woman of color to head the US Trade Representative’s office, has instructed her staff to embrace diversity, think creatively, and engage with long-ignored communities.
As the first African to lead the World Trade Organization, Okonjo-Iweala oversaw trade flows totaling almost $19 trillion in 2019. She stated that attending to women’s needs will be a critical first step in restoring the public’s severely damaged trust in national and international institutions.
“We must ensure that we avoid returning to our previous routines,” stated Okonjo-Iweala, who was also the first female finance minister of Nigeria. “People are the focus. It has to do with diversity. It concerns fair employment for common people, she told Reuters.
