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Asia Losing $89 Billion a Year Failing to Recognize Women: Jobs

Sept. 26 (Bloomberg) -- Japanese Prime Minister Shinzo Abe talks about the need to advance the role of women in the world and for changes in the United Nations Security Council. Abe addresses the United Nations General Assembly in New York. (Video courtesy of United Nations. Source: Bloomberg)

At a booth in one of Manila’s biggest malls, 22-year-old Vanessa Tinitigan sells butter lip gloss from the U.S. and hair extensions from South Korea, part of a business she began at 16 that has made her the family’s main breadwinner.

The self-taught entrepreneur, who also wholesales and exports fashion products, started her company, Purpektion Shop, as a schoolgirl with no formal financial education or access to funds. She now hires part-time workers to run stalls at bazaars and events.

“I struggled, nobody taught me,” said Tinitigan, who is also pursuing a degree in advertising. “Most people don’t know how to start a business and then, when the problems come, they don’t know how to fix it. Many entrepreneurs who started the same time I did are now bankrupt.”

Tinitigan represents the 1 percent of Asia’s working women who run businesses that employ staff -- less than half the rate for men -- as a lack of government support, financial illiteracy and social traditions mean they are mostly confined to lower-paid factory and service jobs, or helping till the family farm. Failure to integrate women fully into the workforce is costing the Asia-Pacific region about $89 billion a year in unrealized output, according to the United Nations.

“We can’t keep training women to be hairdressers, we need to expand their horizons because new opportunities are coming with the transformation of economies in the region,” said Shireen Lateef, senior adviser to the Asian Development Bank and architect of its gender policy framework. “You hear about the glass ceiling in developed countries. In Asia, it’s much more a sticky floor. They’re all stuck at the bottom.”

Stalled Participation

By 2020, there will be about 865 million women worldwide who aren’t contributing as much to the economy as they could, according to analysts at New York City-based management consultant Booz & Co. About 94 percent, or 812 million of them, are in emerging and developing nations, they said, using data from the International Labour Organization in Geneva.

Global female labor-force participation has stalled at about 50 percent for two decades, according to a report last month from the International Monetary Fund. More than half the nations in East Asia and the Pacific have restrictions on the types of jobs women can do, a proportion that rises to 80 percent in South Asia, the World Bank said in a report in September.

Millions in Bangladesh hunch over sewing machines to stitch clothes. Chinese women represent 60 percent of workers who migrate from rural towns to work in city factories. Seventy percent of the world’s female agricultural workers are in the Asia-Pacific region, according to the ILO.

Job Restrictions

Women-owned businesses in the U.S. contribute nearly $3 trillion to the economy, and have been growing at more than twice the rate of businesses owned by men, then-Secretary of State Hillary Clinton said in a speech in June 2012. There are about 6 million formal, women-owned small businesses in East Asia, she said.

About 2.1 percent of working women in developed economies and the European Union ran their own companies in 2009, according to the latest data from the ILO. Among Asian men with jobs, 2.6 percent of them were employers.

Female-run companies on average have fewer workers and make less in sales and profit than those owned and operated by men, the World Bank said. The Washington-based lender said output per worker in East Asia and the Pacific would increase as much as 18 percent if female entrepreneurs and employees worked in the same industries and had the same access to resources as men.

Not Networking

The roadblocks include a lack of formal networking to tap mentors and role models and little availability of advice on basic financial tasks, such as getting a bank loan. Asian businesswomen lag behind men in their use of technology, and face barriers in management and operational challenges, according to a February report from the 21 member economies of the Asia-Pacific Economic Cooperation.

For entrepreneurs like Rusmala Dewi from Palembang on the Indonesian island of Sumatra, the need to earn money for the family means they don’t even finish secondary education.

Dewi left school at 14 because her parents could no longer afford the fees. With about $20 in capital, she started making hand-woven Indonesian brocades called songket, completing about one a month.

“When I started my business, I didn’t know how to sell my songket, how to make new designs and colors, how to prepare a financial report,” Dewi, who is now 37, said in a telephone interview. “In my experience building the business, I realized how important it is to get more and better education.”

Library Book

It took her 14 years to write her first financial account, after reading a library book on the subject. The report helped her get bank funds at cheaper interest rates. The lender also provided guidance and encouraged her to showcase her products at exhibitions. Now her company, Nirmala Songket, employs 150 people and has exhibited her gold- and silver-threaded fabrics abroad.

Social restraints also hold back female participation. When Le Thu Phuong, 24, rejected a Vietnamese government job earlier this year to join a Hanoi-based educational startup, her mother wouldn’t speak to her for a month.

“If we were in the same room, my mother would communicate with me only through my sister,” Phuong said by telephone. “A job in the government is seen as stable even though I would have earned less than I’m getting now.”

‘Self-Inflicted’

Asia’s inability to tap the potential of educated women is like a “self-inflicted wound,” said Simon Ogus, chief executive officer of Hong Kong-based consultancy firm DSGAsia Ltd. He said the region’s inadequate structures for child- and elderly care also sap the contribution of educated Asian women.

Some governments are trying to be more supportive by increasing access to finance. Vietnam, Laos and Indonesia have implemented land reforms that would allow women more property rights that can be used as collateral for loans, ADB’s Lateef said.

India’s government said in February it would create the country’s first bank exclusively for women, with 10 billion rupees ($160 million) in initial capital. Lenders such as the PhilippinesRizal Commercial Banking Corp. (RCB) have set up programs to boost loans to women.

Government assistance helped Noranis Ayu Nordin, 40, quit her Malaysian civil service job in August to open a 700-square foot bakery and cafe in Cyberjaya near the capital, Kuala Lumpur. The divorced mother of four read books on business planning and tapped a government loan of 50,000 ringgit ($15,340) to achieve her dream.

Filling Forms

“There are a lot of places now you can get help to start your business,” said Noranis, who has hired five women to help her bake and decorate birthday cakes, tiramisu and pastries. “You just have to fill out the forms.”

In Thailand, a 2010 study by MasterCard Worldwide showed small- and medium-sized enterprises owned by women have an average annual growth rate of more than seven times that of male-run counterparts.

Still, even in the only Southeast Asian nation with a female leader, discrimination remains. Thailand was ranked 66 out of 148 countries in gender inequality, worse than Vietnam and China.

In Thailand, only the head of the household can buy land and married women need their husband’s consent for some legal transactions, according to the Paris-based Organization for Economic Cooperation and Development. Filipino wives often need a spouse’s signature on loan documents, according to the ADB.

“Everybody asks me if I’m married and have kids because that’s what they expect,” said Hien Dao, 39, the female founder and chief executive officer at Golden Path Academics Vietnam Co., which helps Vietnamese students prepare for entry into U.S. universities. “They think that a woman like me should be having kids and looking after her husband -- what am I doing running a business?”

To contact the reporter on this story: Shamim Adam in Singapore at sadam2@bloomberg.net

To contact the editor responsible for this story: Stephanie Phang at sphang@bloomberg.net

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Photographer: Adeel Halim/Bloomberg

Women work at the site of JSW Bengal Steel Ltd. in Salboni, India.

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Photographer: Adeel Halim/Bloomberg

Women work at the site of JSW Bengal Steel Ltd. in Salboni, India. Close

Women work at the site of JSW Bengal Steel Ltd. in Salboni, India.

Photographer: Kainaz Amaria/Bloomberg

Commuters ride in the women-only compartment of a passenger train during rush hour in Mumbai. Close

Commuters ride in the women-only compartment of a passenger train during rush hour in Mumbai.

Photographer: Jeff Holt/Bloomberg

A worker sews plaid shirts on the production line of the Fashion Enterprise garment factory in Dhaka, Bangladesh. Close

A worker sews plaid shirts on the production line of the Fashion Enterprise garment factory in Dhaka, Bangladesh.

Photographer: Paul Hilton/Bloomberg

A woman collects rice from a rice paddy on the outskirts of Ho Chi Minh City. Close

A woman collects rice from a rice paddy on the outskirts of Ho Chi Minh City.

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