Every March, we celebrate Women’s History Month as a way to recognize and honor the contributions of women throughout American history. Certainly, strides in gender equality have been made, but the push to achieve parity for women in the workplace has moved at a glacial pace. In the last few years, we’ve seen more women ascend to the top ranks of companies, yet women leaders are switching jobs at the highest rates we’ve seen—and at higher rates than men in leadership. That could have serious implications for businesses. As McKinsey’s “Women in the Workplace 2022” demonstrates, “women are dramatically underrepresented in corporate America.” In the staffing industry, however, women leaders abound and thrive. It’s not just an example we can set but a charge we can lead across industries.
Gender Parity Challenges Begin Way Below the Glass Ceiling
The conventional wisdom surrounding issues of gender inequality in the workplace usually points to the “glass ceiling,” a metaphorical barrier that prevents women from reaching senior leadership positions. But we must also consider another symbolic obstacle: the broken rung.
“Women are already significantly underrepresented in leadership,” McKinsey asserted. “For years, fewer women have risen through the ranks because of the ‘broken rung’ at the first step up to management. Now, companies are struggling to hold onto the relatively few women leaders they have. And all of these dynamics are even more pronounced for women of color.”
The culture of work is equally important. All employees should feel respected and that they have an equal opportunity to grow and advance. Employees care deeply about opportunity and fairness, not only for themselves but for everyone. They want the system to be fair. Done right, efforts to hire and promote more diverse candidates and create a strong culture reinforce each other. A more diverse workforce will naturally lead to a more inclusive culture. And when a company’s culture feels fair and inclusive, women and underrepresented groups are happier and more likely to thrive.
This is essential not just for existing women leaders, whom we risk losing, but also for future women leaders. According to McKinsey’s research, young women have demonstrated greater ambition than their predecessors and placed a higher premium on working in equitable, supportive, and inclusive cultures. However, watching senior women abandon companies for better opportunities often inspires younger talent to follow suit. Despite some archaic rhetoric, the rise of women in management has little to do with ambition. The very culture of a company more likely signals an atmosphere of opposition and hurdles in the path toward advancement that men don’t encounter.
“They’re more likely to experience belittling microaggressions, such as having their judgment questioned or being mistaken for someone more junior,” McKinsey said of women trying to climb up through the ranks. “They’re doing more to support employee well-being and foster inclusion, but this critical work is spreading them thin and going mostly unrewarded. And finally, it’s increasingly important to women leaders that they work for companies that prioritize flexibility, employee well-being, and diversity, equity, and inclusion (DEI).”
The irony here is that when women are denied the very DEIB they’re championing, the message is that “you’re not valued.”
Since 2015, we have experienced a rise in the number of women executives in Corporate America. The representation of c-level women leaders increased from 17% to 21% over the past five years. Yet even that figure excludes a large swath.
- Only 1 in 4 c-suite executives is a woman.
- In that same environment, only 1 in 20 executives is a woman of color.
- For every 100 men hired and promoted to management positions, just 87 women are hired and promoted. Only 82 are women of color.
- “As a result,” McKinsey reported, “men significantly outnumber women at the manager level, and women can never catch up. There are simply too few women to promote to senior leadership positions.”
- Women leaders are also leaving their companies at the highest rates witnessed in years. If the current voluntary attrition rate for men is 9%, it’s nearly 11% for women. To put that into perspective, voluntary attrition figures for men and women in 2020 were virtually the same.
Progress and Pitfalls in Gender Equality
- Representation of women in c-suite roles increased 24%.
- Company commitments to gender diversity increased by 13 percentage points.
- Sponsorship of women rose by 8 percentage points.
- Businesses that offered the flexibility of remote or flexible working arrangements grew by 30 percentage points.
Why Are Women Leaving?
According to McKinsey, these are the predominant factors that contribute to women leaving their employers to find greener pastures.
- Lack of advancement opportunities
- Low level of management support
- Lack of flexibility in working arrangements
- Limited commitment to DEIB by the organization
- Limited commitment to employee well-being by the organization
Even Greater Challenges for Diverse Women
- Latinas and Black women are less likely than women of other races and ethnicities to believe that their manager supports their career development. They also experience less psychological safety: less than half of Latinas and Black women say people on their team aren’t penalized for mistakes.
- Asian women and Black women are less likely to have strong allies on their teams. They are also less likely than White women to say senior colleagues have taken important sponsorship actions on their behalf, such as praising their skills or advocating for a compensation increase for them.
- Latinas and Asian women are more likely than women of other races and ethnicities to have colleagues comment on their culture or nationality—for example, by asking where they’re “really from.”
- LGBTQ+ women and women with disabilities report experiencing more demeaning and “othering” microaggressions. Compared with women overall, they’re more likely to have colleagues comment on their appearance or tell them that they “look mad” or “should smile more.”
- Women with disabilities often have their competence challenged and undermined. They are significantly more likely than other groups of women to have their judgment questioned in their area of expertise and to have colleagues get credit for their ideas.
The Economic Benefits of Gender Equality
UN Women is a United Nations branch dedicated to gender equality and the empowerment of women. UN Women was established to accelerate progress on meeting championing the needs of women and girls worldwide. The group works to establish global standards for achieving gender equality while coordinating with governments and civil society to design laws, policies, programs, and services to ensure that the standards are effectively implemented and truly benefit women and girls across the globe.
The mission of UN Women reaches beyond idealism and moral integrity: “Women’s economic empowerment is central to realizing women’s rights and gender equality.” Simply put, when more women work on a level playing field to men, economies grow.
- Women’s economic empowerment boosts productivity, increases economic diversification, income equality, and other positive development outcomes.
- Increasing the female employment rates across countries to match that of Sweden could boost gross domestic product (GDP) by over $6 trillion USD.
- Conversely, it is estimated that gender gaps cost the economy some 15% of GDP.
- The UN estimates that “companies with three or more women in senior management functions score higher in all dimensions of organizational performance.”
We’re Still a Long Way from True Gender Equality
Despite the positive results of enforcing gender parity, hesitation persists. Growth of GDP alone, for example, does not automatically lead to a reduction in gender-based inequality. Increased educational attainment accounts for about 50% of the economic growth in developed nations over the past half century. But for the majority of women, significant gains in education have not translated into better employment opportunities. And that also hurts the wider economy.
- Women tend to spend around 2.5 times more time on unpaid care and domestic work than men; if women’s unpaid work were assigned a monetary value, it would constitute between 10% and 39% of GDP.
- In 40% of economies, women’s early stage entrepreneurial activity is half or less than half of that of men’s.
- The economic costs of discrimination and violence toward women is estimated to cost approximately $12 trillion USD annually.
How MSPs and Staffing Providers Can Help Promote Gender Parity
Set Development and Advancement Goals
McKinsey discovered that while companies have placed greater emphasis on moving women into senior leadership positions, they’ve fallen short of a more critical process—getting women into first-level management roles. Given how important it is to fix the broken rung, staffing providers and MSPs can collaborate with clients to set and publicize bold goals to grow the number of women at the manager level. Moreover, they can help put targets in place for hiring and promotions that most directly shape employee representation.
Enforce Diversity Goals Across All Levels
Many organizations have established diversity requirements for promotions at senior levels. But again, these steps lack an aggressive and all-inclusive drive to foster diversity at lower, more imperative levels. Research has consistently demonstrated that enterprise-wide inclusion practices are powerful motivators of change throughout an organization. With a higher number of diverse candidates in the pipeline of most staffing agencies and MSPs, the likelihood that one will be hired rises dramatically for clients.
Focus on Education and Skills Development
Education, upskilling and re-skilling – especially to keep pace with rapid technological and digital transformations affecting jobs—are critical for women’s health and wellbeing, as well as their income-generation opportunities and participation in the formal labor market. Today women make up under a third of the workforce in science, technology, engineering, and math (STEM). By 2050, 75% of jobs will fall under STEM categories. Yet today, women hold just 22% of positions in artificial intelligence, as just one example. As we outline in our eBook New Talent Strategies for Our New Normal, staffing providers and MSPs have excellent opportunities to align with and leverage Massive Open Online Course (MOOC) programs to enhance ongoing education and development for talent.
Choice and Flexibility in Working Arrangements Is Critical
A “one size fits all” approach to working arrangements simply doesn’t work, particularly when women are still tasked with the majority of childcare, household, and family support responsibilities. Agency is critical in retention.
“Only one in ten women wants to work mostly on-site, and many women point to remote- and hybrid-work options as one of their top reasons for joining or staying with an organization,” McKinsey said. “These preferences are about more than flexibility. When women work remotely at least some of the time, they experience fewer microaggressions and higher levels of psychological safety. The decrease in microaggressions is especially pronounced for women of color, LGBTQ+ women, and women with disabilities—groups who typically face more demeaning and othering behavior.”
Staffing providers and MSPs excel at asynchronous workforce management — it’s been a part of the inherent business model long before the pandemic. Using an MSP, for example, helps clients capitalize on effectively managing remote talent to the benefit of all.
Create Unbiased Evaluation Processes
More staffing companies and MSPs are turning to unique vetting processes to remove biases in hiring. An evaluation group is one facet. After determining potential biases in a group, categorize them. This allows you to uncover attitudes that lead to homogeneous hiring or potential discrimination. Create a dedicated team of interviewers who are likely to be the most impartial as a group. Work out a series of questions with these individuals, ensuring that everyone agrees. This gives you the opportunity to identify and weed out remaining biases within the group, standardize the questions, and create relevant evaluation criteria.
Blind resumes also hold promise in restoring objectivity. In this process, remove all contact and personal information. These details—especially when they hint at age, gender, culture, and other attributes—can stoke unconscious biases in the minds of reviewers. A blind resume includes only skills, objectives, work experience, and education. Truly blind resumes even edit details of education to display only academic data, such as degrees achieved and honors awarded.
How the Staffing Industry Can Help Even More
Diversity has long been the hallmark of the staffing industry. And with increasing frequency, agencies in the space are transforming from transaction recruiting and placement firms to consultative workforce solutions providers that emphasize training, development, and DEIB initiatives. Our friend Wen Stenger is CEO of one such organization, Omni Inclusive. Its mission is to prioritize inclusion and sustainability, providing business consulting for diversity, equity & inclusion (DEI), and supplier sustainability strategies.
Omni Inclusive isn’t alone. Many agencies are undergoing similar transformations and offering these services based on decades of internal experience in DEIB. As the staffing industry continues its march to find ways of innovating, services and technologies focused on DEIB could be more relevant to progress than the current direct sourcing buzz.
It’s About People, Not Merely Gender
As we celebrate the achievements of women in history during this month-long commemoration, we must not lose sight of the women who have yet to achieve. Without support, equal opportunities, agency, level playing fields, and a voice, women will continue to face insurmountable obstacles on their paths to success. And as that happens, the businesses that uphold outdated biases will likely never realize their true potential either.