Our services in the selected location:
  • No services available for your region.
Select Location:
Remember my selection
Your browser is out of date. It has known security flaws and may not display all features of this and other websites

August 25, 2020 | GSAM Connect

100 Years of Empowering Women

August 26, 2020 marks the 100th anniversary of women’s suffrage, granting women the right to vote. Since the ratification of the 19th Amendment, women have had great impact on the US economy. With substantial progress in education and labor force participation, women’s contributions have helped to grow the pie for everyone. One of the next steps in continuing to grow opportunity, in our view, is in building wealth and investment confidence.

The number of women and girls in the United States has grown from 51 million in 1920 to 167 million in 2019, representing 51% of the US population1. In 1920, there were 8 million women in the labor force, mostly employed in domestic and personal services as teachers and stenographers. Today, women represent 47% of the labor force2, with 75 million women employed in a wide range of professions. Women also continue to make notable progress across professional and managerial occupations. Over 40% of women in the labor force had college degrees in 2019, compared with 11% in 1970. Additionally, women have been more likely than men to have earned a bachelor’s degree by age 291.

We believe the return on investment in women is high. In the last decade, women’s earnings have grown 8% per year and women are expected to control $11 trillion in US wealth this year3. But despite the increasing role that women have played in the economy and notwithstanding higher educational advancement, gender inequities continue to persist. By advancing women’s equality in the US, the economy could potentially add $4.3 trillion to annual GDP in 2025, 19% more than business-as-usual activity. On a more local level, every US state and city can add at least 5 percentage points to their GDP in the next 5 years by engaging the economic potential of women4. Our bottom line, investing in women benefits everyone.

One obstacle to women’s economic contribution is wage disparity. Incomes have not risen in tandem with women’s increasing contribution to the economy, and the ~20% gender wage gap still persists. As Exhibit 1 shows, the wage gap can be attributed in part to industry, occupation, and education, but a large part is still unexplained. Likely due to unconscious bias, this challenge also represents a multi-trillion-dollar economic opportunity if it can be overcome.

EXHIBIT 1: Gender Wage Gap

Source: Goldman Sachs Global Markets Institute and GSAM. As of October 31, 2019. For illustrative purposes only.

Building female wealth is especially critical in our view due to their unique set of circumstances, including the wage gap, longer life spans, and disproportionate responsibility for children and elders. From a labor market perspective, companies need to actively address gender gaps in the workplace by hiring more women at the entry-level, preventing women from downshifting into lower profile positions and reducing the female attrition rate.

Additionally, to help address the economic and investing realities that women face, we need to also empower the female investor by helping women gain confidence to take control of their finances. We believe investment literacy and access to expert advice are crucial to making financial progress, but hard to obtain if individuals lack investing confidence or awareness of potential investment options. 

Through a mnemonic seven-step framework, the GSAM EMPOWER series aims to address common investment challenges, highlight ways to build confidence and identify solutions to help female investors empower themselves financially. Because the evidence is clear, as stated by Christine Lagarde, former head of the IMF and current head of the ECB, “when women do better, economies do better.” 


Source: GSAM. As of July 31, 2020. For illustrative purposes only.


Stay posted on the latest market developments and key themes for your portfolios and practices.
Get Connected

About the Author

Candice Tse

Candice Tse

Managing Director, US Head of Market Strategy, GSAM Strategic Advisory Solutions

Related Insights

June 25, 2020 | GSAM Connect
The Great ESG Reset

The COVID-19 crisis has tested the resiliency of corporations and in our view will likely reshape their roles in the world.