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Women outpace men in making money; key reasons behind erosion of billionaires’ wealth in 2018

Strong US dollar, trade tension, low expectations of global economic growth and volatility in financial markets have eroded the wealth of billionaires throughout the world. In 2018, billionaire wealth dropped by 4.3 per cent to USD 388 billion, according to a UBS-PwC report. The only area where billionaire wealth increased in 2018 was ‘technology’. The wealth of billionaires in the technology sector rose 3.4 per cent to USD 1.3 trillion in the year. Also, their net wealth doubled over the last five years due to the new technological dynamics of the global economy. The report says that software, internet, and electronic equipment entrepreneurs have built powerful businesses over the past three decades. 

Meanwhile, in the five years to 2018, women billionaires have generated wealth at a faster rate than their male counterparts. The number of female billionaires increased by almost half in the period, rising from 160 to 233, whereas the number of men expanded by a little over one-third in the same duration.  

Even though billionaire’s wealth took a hit in 2018, their wealth in the five years to 2018 grew by more than one-third, reaching a total of USD 8.5 trillion, USD 2.2 trillion higher than five years. 

“As we look ahead to the next five years, it is difficult to predict the future. Our research tells us that leading entrepreneurs are primed for a more difficult environment. But what will remain constant is the billionaire effect – the ability to transform entire industries, to create large numbers of well-paid jobs, and to rally the world to find cures for diseases such as malaria,” the report said. 

Over the 15 years to the end of 2018, billionaire-controlled companies listed on the equity market returned 17.8 per cent versus the 9.1 per cent of the MSCI ACWI, almost twice the annual average performance of the market. Their companies were also more profitable, earning an average return on equity of 16.6 per cent over the last 10 years, compared to 11.3 per cent of the MSCI ACWI.

Source: Financial Express