October 2022
Women in the Workplace 2022 Report: ‘The Great Breakup’ Is Hurting Employers in Need of Leaders
It took some time, but it looks like women have finally recouped the net job losses they experienced in the wake of the coronavirus pandemic’s arrival in early 2020.
Consider recent Bureau of Labor Statistics (BLS) data, which shows that women gained 155,000 jobs in September 2022. Overall, the U.S. economy added 263,000 overall jobs in September, with women gaining more than half (59%) of those new jobs last month, according to the BLS. This growth marks 21 months of consecutive job gains for women, who hold 85,000 more jobs now than in February 2020.
But, while women may be rejoining the labor force in larger numbers, many female workers are frustrated by a lack of opportunities to continue growing and advancing professionally within their current organizations.
That’s according to the 2022 Women in the Workplace report, which finds women—especially those in senior and leadership roles—are leaving their employers in droves to seek out opportunities for growth elsewhere.
Conducted by LeanIn.org and McKinsey & Co. every year since 2015, the annual study examines the state of women in corporate America. This year, the organizations focused on how the pandemic has changed what women want from their companies, including the growing importance of opportunity, flexibility, employee well-being and diversity, equity and inclusion (DEI).
More than 40,000 employees participated in the 2022 study, with the roughly 22,000 women who took part sending a resounding message.
“Let’s be clear: Women aren’t saying they don’t want to work,” McKinsey & Co. Senior Partner Lareina Yee, recently told CNBC.
“They’re breaking up with companies because they’re confident they will get an opportunity to advance somewhere else, which is something we haven’t seen before. … It really speaks to the fact that loyalty has its limits.”
While noting “modest progress” that’s been made over time, the 2022 report finds women still significantly underrepresented at the senior and leadership levels. For example, women comprised just 26% of C-suite positions at the start of 2022, representing just a 6% increase compared to five years ago. And, that number drops drastically when it comes to women of color, who held just 6% of C-suite roles at the beginning of this year.
As for the women who have ascended to the highest levels of the organization, they’re “leaving their companies at the highest rate in years,” according to the report, which found the attrition rate for women in leadership positions hovering around 10% in 2022, while that number was closer to 8% in 2017.
What’s Driving Departures
There are several factors contributing to what this year’s Women in the Workplace report describes as “The Great Breakup” between women leaders and their organizations.
The importance of offering flexible work arrangements, for example, can’t be overstated. Indeed, 49% of women leaders surveyed said flexibility is one of the top three factors they consider when deciding whether to join or stay with a company, compared to 34% of men leaders.
“For the first time in my career, we’re seeing people leaving and going to companies with a more generous work from home policy,” said one respondent, a Black female vice president. “So, I dug into the data, and I realized something about every single person leaving. They were all women.”
In addition, women leaders who want to advance often face unique hurdles, the report points out.
For example, the report finds women leaders are twice as likely as men leaders to be mistaken for someone more junior. According to the report, 37% of women leaders have had a co-worker get credit for their idea, compared to 27% of male leaders.
“Women leaders are as likely as men at their level to want to be promoted and aspire to senior-level roles. In many companies, however, they experience microaggressions that undermine their authority and signal that it will be harder for them to advance,” the report authors wrote.
“For example, they are far more likely than men leaders to have colleagues question their judgment or imply that they aren’t qualified for their jobs. Women leaders are also more likely to report that personal characteristics, such as their gender or being a parent, have played a role in them being denied or passed over for a raise, promotion or chance to get ahead.”
Female leaders are also often “overworked and under-recognized,” according to the authors. For instance, women leaders are twice as likely as male leaders to spend substantial time on DEI work, with 40% of women saying their work on DEI-related initiatives isn’t acknowledged at all in performance reviews.
“Spending time and energy on work that isn’t recognized could make it harder for women leaders to advance,” the authors wrote. “It also means that women leaders are stretched thinner than men in leadership; not surprisingly, women leaders are far more likely than men at their level to be burned out.” (43% of women leaders said they’re experiencing feelings of burnout, compared to 31% of men at their level saying the same.)
“Burnout from management responsibilities and unsustainable workload has made me more ambitious, but not in the same way,” one female senior manager told the authors. “I’m more ambitious about going after something different. I’m more ambitious about making a career change or going after something where I feel more fulfilled.”
Fixing the Leadership Pipeline
The COVID-19 pandemic has dramatically underscored the role that factors such as flexibility and organizational commitment to DEI play in contributing to female leaders’ sense of professional fulfillment. And, employers that don’t emphasize such components of the employee experience risk losing these leaders, according to the Women in the Workplace report, which finds the issues that drive women leaders to leave their companies are even more important to young women.
“Young women care deeply about the opportunity to advance,” the report noted, pointing out that more than two-thirds of women under 30 said they want to become senior leaders, with a majority of these respondents saying that advancement has become more important to them in the past two years. Young women are also more likely than women leaders to say they’re “increasingly prioritizing flexibility and company commitment to well-being and DEI.”
Employers that don’t demonstrate the same type of commitment “may struggle to recruit and retain the next generation of women leaders,” the authors wrote, “and for companies that already have a ‘broken rung’ in their leadership pipeline, this has especially worrisome implications.”
The report offers a series of recommendations to help employers keep their female leadership pipelines full, and to ensure that female leaders continue to develop and grow with your organization.
For example, the study authors urge employers to track metrics and set goals around gender equality—tracking representation and attrition by gender and race, and surveying employees about remote work and flexible scheduling preferences, among other steps.
The report also emphasizes the importance of holding leadership accountable for progress toward gender equality goals—ensuring senior leadership reviews diversity metrics at least quarterly, sharing diversity metrics publicly and providing financial incentives to senior leaders for making progress on diversity metrics, for example.
Career development programs for women and women of color—women’s employee resource groups (ERGs) and formal sponsorship and/or mentorship programs specifically for women and/or women of color, for instance—also play a critical role in developing women within an organization.
Ultimately, employers seeking to make meaningful and sustainable progress toward gender equality must focus on two broad goals, according to the McKinsey and LeanIn.org report: Get more women into leadership and retain the women leaders they already have.
“This will require pushing beyond common practices. Companies that have better representation of women, especially women of color, are going further,” the report authors wrote. “They’re doubling down on setting goals, tracking outcomes and holding leaders accountable—the building blocks of driving organizational change.”
20 October 2022
Category
HR News Article