IT and Women’s Labor ForceParticipation in the Middle East

NEC Corporation

Yasushi Kaito, Advisor

December 8, 2004

2

Contents

1. Major Issues in the Middle East

2. The Middle East Economic Growth

3. IT Industry and the New Economy & Society under

Globalization

4. Proposal

3

Data ： Arab Human Development Report 2003, UNDP US Bureau of Census 2002 ILO Global Employment Trends

Slow Slow Economic GrowthEconomic GrowthGDP growth/person

1990 - 20000.7%

(Asia: 6%)

Small Small Economic ScaleEconomic Scale

$600Bil (Equal to Spain)

Youth PopulationYouth PopulationUnder 20: 45.9%Under 35: 70.8%

Education SystemEducation System

*****Productivity Productivity

Brain DrainBrain Drain25% of 300,000

college grads flow outside the region

Uneven Distribution Uneven Distribution of Wealthof Wealth

**********Declining Middle ClassDeclining Middle Class

R&DR&D0.2% of GDP,

Government-lead,Only 2% to IT field

High High UnemploymentUnemployment

2003: 13.3%Youth: 27%

(World Avg.:6.2%)

Materialistic/Materialistic/Power-orientedPower-oriented

Materialistic/Materialistic/Power-orientedPower-oriented

Isolation fromIsolation fromGlobal TrendsGlobal TrendsIsolation fromIsolation fromGlobal TrendsGlobal Trends

RegionalRegionalInstabilityInstability

RegionalRegionalInstabilityInstability

1. Major Issues in the Middle East

Gender Gender InequalityInequality

Small Small Foreign Direct Foreign Direct

InvestmentInvestment

4

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

1-1. Small Foreign Direct Investment

Investment Balance 1980 1990 2000

OutwardWorld Share

Ranking

3.7%

8th

11.7%

3rd

4.7%

8th

InwardWorld Share

Ranking

0.5%

28th

0.5%

28th

0.9%

22nd

・ Japan, EU & USA share trends of FDI balance(%)

EU

USA

Japan

Data: 2002 JETRO White Paper on International Trade & Foreign Direct Investment 　 World Bank MENA Development Report

-Foreign Direct Investment (2000):

$2.2Bil

(only 1% of total investments to developing countries)

- FDI against GDP

Japan Middle East

1990 2002

Mid-East & North Africa 0.6% 0.9%

Latin America 0.7% 2.7%

East Asia 1.6% 3.1%

Japan 0.1% 0.2%

World Avg. 1.0% 2.0%

5

0%

5%

10%

15%

20%

25%

30%

35%

40%

Ger

man

y

Fran

ce

Aust

raliaUKUSA

Thailand

Malay

sia

Indo

nesia

J apa

n

Turk

ey

J ord

anIran

Egyp

t

Liby

a

Kuwait

Yem

en

Saud

i Ara

bia

ＵＡＥ

Om

an

% of Women inParliament, etc. (2003)

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

Labor ForceGender Parity Index(2002)

% of Women in Parliament or itsequivalentLabor Force Gender Parity Index

Data: 2004 World Development Indicators

1-2. Gender Inequality

24

64

7 810 9

14

18

25

12

32

Middle East

Labor Force Gender Parity Index:Ratio of the percentage of women who areeconomically active to the percentage of men who are

Labor Force Gender Parity Index:Ratio of the percentage of women who areeconomically active to the percentage of men who are

6

Male/Female Employment Rate (FY2002)

59.6% 40.4%

TotalEmployed53.69 mil.

Percentage of Women in Management Positions

USA

45.1%

Germany

26.3%

Canada

35.1%Sweden

28.8%

Japan5.8%

Korea4.9%

0%

10%

20%

30%

40%

50%

Employment Rate for Women

1980 52.1 ％

2002 62.4 ％

Data: The Yomiuri Shimbun, others

Male

Female

1-3. Japanese Women’s Advancement into Society

7

0

500

1,000

1,500

2,000

1980 1985 1990 1995 2000 2002

Latin America & Caribbean

East Asia & Pacific

Europe & Central Asia

South Asia

Middle East & North Africa

Sub-Saharan Africa

Data: 2004 World Development Indicators

Remarkable growth in manufacturingWorld’s manufacturing baseImmense market

Remarkable growth in manufacturingWorld’s manufacturing baseImmense market

(Billion $ ）

2. The Middle East Economic Growth 2-1. GDP Comparison by Region: 1980-2002

8

Economic Growth

Human Capital Physical Capital（ Capital Development ）

Natural Capital（ Natural Resources ）

Total Factor Productivity(Technology) + (Institution)

・ Adult literacy （ M/F)

　 76%/55%

　 (83%/70%)

・ Female Employment Rate

　 33.8% (60.3%)

・ Education does not meet

societal needs

Vs. GDP percentage

　・ Foreign capital vs. inward investment

　 0.9% (2.5%)

　・ Private investment

　 50.2% (55.9%)

・ Rich energy resources

・ World share of product exports

4% (1990)3% (2002)

・ % of high-tech product exports

2% (17%)

・ Articles on science & technology

3,617 （ 5% of developing

countries ）

Data: 2004 World Development Indicators

（　）： Developing country avg.

Adult ： 15 years or older

* Data as of 2002

Annual Avg. Growth (1990 - 2002)Middle East: 3.2%（ East Asia: 7.3% ）（ Developing country avg.: 3.4% ）

Per Capita Growth (1990 - 2000)Middle East: 0.7%(East Asia: 6.0%)(Developing country avg.: 2.0%)

（　）： Developing country avg.

（　）： Developing country avg.

2-2. Analysis on the Slow Economic Growth

9

New World Economy

Service

Knowledge-centered SocietyKnowledge-centered Society

IT IndustryIT IndustryReference Data: 　 “High Noon,” J.F.Rischard　“ Strategies for Industries in Japan,” 　 Yoko Ishikura, etc.

3. IT Industry & the New Economy and Society under Globalization

TechnologicalInnovation

TechnologicalInnovation

EconomicInnovation

EconomicInnovation

STRESSAdaptation to NewRules:*Speed*Borderless*Knowledge-Intensive*Severe Competition

STRESSAdaptation to NewRules:*Speed*Borderless*Knowledge-Intensive*Severe Competition

CHANCES1. New Product/ New Market2. End of Inflation3. Improvement of Productivity

CHANCES1. New Product/ New Market2. End of Inflation3. Improvement of Productivity

10

Added Value

Human Power

IT IndustryVirtualVirtualCreating

New Society

LocalizationLocalizationLocalized Business

NetworkingNetworkingBorderless Business

AnyoneAnyoneRegardless of

Nationality/Gender

AnywhereAnywhereRegardless of

Workplace

AnytimeAnytimeRegardless of

Working Time

AffordableAffordableLow Start-Up Cost

3-1. Characteristics of the IT Industry

IT Industry:-Great Potential for Growth

“Women-Friendly”-Huge Capacity for Absorbing Labor Force

11

3-2. Women-Friendly IT Works

IT Industry:

- Offers chances to skilled women (foreign language, law, finance, etc)

- Allows homemakers to work at home (SOHO)

Work-at-HomeWork-at-Home

・ Data Input・ Translation・ Call Center

Education-Education-RelatedRelated

・ IT Education

DesigningDesigning

・ Web Site・ Contents

Technology-Technology-OrientedOriented

・ Software Design・ IT Consulting

Entry-Level

Troubleshooting-No Customer Info Required

-No Advanced Skill Required

Virtual Call Center

Customer

12

We should deepen business interactions between We should deepen business interactions between Japan & the Middle East in the field of human capitalJapan & the Middle East in the field of human capitalthrough the following activities:through the following activities:

1) Work on issues shared by Japan and the Middle East to increase1) Work on issues shared by Japan and the Middle East to increase women’s participation in the IT societywomen’s participation in the IT society - Set up a place for interactions among women in IT businesses- Set up a place for interactions among women in IT businesses in Japan and the Middle East;in Japan and the Middle East;

2) (In future) Establish venture capital funds and foster female IT2) (In future) Establish venture capital funds and foster female IT entrepreneursentrepreneurs

(FYI) Japanese Community Site for Improving Women’s Activities:(FYI) Japanese Community Site for Improving Women’s Activities: “ “eWoman” eWoman” http: //www.ewoman.co.jphttp: //www.ewoman.co.jp

4. Proposal